To identify a key pivot point for an altcoin season, let’s analyze Bitcoin Dominance (BTC.D) using the Monthly Chart, which provides a clearer overview of pivot levels and trends.
Current Outlook on BTC Dominance
Stochastic RSI Signals Bearish Momentum
The Monthly Stochastic RSI turned bearish in November with a confirmed bearish crossover. This suggests a continued decline in BTC dominance and aligns with the larger market narrative of Bitcoin being in its final Wave 4 & 5 of the current cycle.
Rejection at the 0.618 Fibonacci Level
In November, BTC dominance rejected the 0.618 Fibonacci retracement level, a significant resistance point. A similar rejection occurred during the 2021 bull run, marking the peak in BTC.D and the shift of money pouring into Alt Coins.
What Happened After the 2021 Rejection?
After BTC.D rejected the 0.618 level in 2021:
As BTC.D retraced to the 0.382 Fibonacci level, Bitcoin and dominance both consolidated and moved sideways. During this period, altcoins experienced exponential growth, with many hitting new highs.
Where Are We Now?
The current setup appears to mirror the 2021 scenario:
What to Watch Next
Key Consolidation Levels:
Altcoin Season Peak:
Conclusion
The rejection at the 0.618 level and the bearish monthly Stochastic RSI suggest that Bitcoin dominance is poised to decline further. If history repeats, we could see a significant rally in altcoins while Bitcoin continues to rise. Monitoring BTC.D’s retracement to 53.9% or below and its potential fall through 47% will be crucial for identifying the peak of altcoin season and planning a timely exit.
Current Outlook on BTC Dominance
Stochastic RSI Signals Bearish Momentum
The Monthly Stochastic RSI turned bearish in November with a confirmed bearish crossover. This suggests a continued decline in BTC dominance and aligns with the larger market narrative of Bitcoin being in its final Wave 4 & 5 of the current cycle.
Rejection at the 0.618 Fibonacci Level
In November, BTC dominance rejected the 0.618 Fibonacci retracement level, a significant resistance point. A similar rejection occurred during the 2021 bull run, marking the peak in BTC.D and the shift of money pouring into Alt Coins.
What Happened After the 2021 Rejection?
After BTC.D rejected the 0.618 level in 2021:
- Bitcoin Continued Rising: Bitcoin’s price rallied as dominance declined.
- Altcoin Market Share Increased: This shift in dominance marked the beginning of Alt Season, with altcoins gaining significant market share.
As BTC.D retraced to the 0.382 Fibonacci level, Bitcoin and dominance both consolidated and moved sideways. During this period, altcoins experienced exponential growth, with many hitting new highs.
Where Are We Now?
The current setup appears to mirror the 2021 scenario:
- BTC dominance rejected the 0.618 Fibonacci level in November.
- A decline in dominance is expected, leading to - 1) Bitcoin’s price increasing. 2) Bitcoin dominance decreasing, signaling the expansion of the altcoin market.
What to Watch Next
Key Consolidation Levels:
- BTC dominance could retrace to around 53.9% or lower, where consolidation is likely to occur.
- During this phase, the altcoin market is expected to expand further, with surging prices and new all-time highs.
Altcoin Season Peak:
- A critical level to monitor is 47% dominance (0.618 Fibonacci level). Once BTC.D falls below this threshold, the market may approach the peak of altcoin season.
- At this stage, consider developing an exit strategy, as altcoins could be nearing their cycle highs.
Conclusion
The rejection at the 0.618 level and the bearish monthly Stochastic RSI suggest that Bitcoin dominance is poised to decline further. If history repeats, we could see a significant rally in altcoins while Bitcoin continues to rise. Monitoring BTC.D’s retracement to 53.9% or below and its potential fall through 47% will be crucial for identifying the peak of altcoin season and planning a timely exit.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.