The Bitcoin dominance rate has been hovering in a tight range since the beginning of February, but is expected to collapse at some point.
Both altcoin market capitalization and ETH / BTC are expected to trend higher.
Bitcoin dominance movement
The BTCD has moved down since hitting a local high of 73.63% in December 2020. The move up to this point was a failed breakout attempt above the 71% resistance range. This is a resistance that has been in place since December 2017. The rejection left a long top wick.
Technical indicators are bearish. The MACD has just entered negative territory, the stochastic oscillator is about to make a bearish cross, and the RSI is below 50.
If the BTCD continues to decline, the closest area of support is 57.50%. Below that, the next most likely support is 49.82% when a disorder occurs.
The daily chart offers a more mixed outlook, but the weekly readings don’t scare off.
BTCD has consolidated between 60 and 64% since early February, but did not close above the latter.
Technical indicators are relatively neutral, but show declining momentum. This is evidenced by the possible retrograde cross in the stochastic oscillator.
Altcoin market capitalization
Altcoin market capitalization (ALTCAP) also suggests that altcoins are likely to rise.
Altcoin market cap decreased significantly last week, creating a bearish candlestick. However, this only served to confirm the previous high of $ 450 billion as support.
Technical indicators are bullish, and the RSI has even created a hidden bullish divergence – a strong sign that the trend is continuing.
ALTCAP chart from TradingView
ETH / BTC
Since Ethereum (ETH) is the largest altcoin in terms of its market capitalization, the price movement compared to Bitcoin has a significant impact on the BTCD.
Cryptocurrency trader @Altoinsherpa sketched an ETH / BTC chart noting that the pair has pumped in the past March / April and will likely do the same this time around.
ETH is currently trading directly at the Fib retracement level of 0.618 of the last uptrend at 0.03 ..
The move looks like a completed bullish impulse and an irregular ABC level after that. This pattern could lead to an upward move.
While the technical indicators are still bearish, they are gradually showing a momentum reversal, suggesting that ETH / BTC could be close to the bottom.
ETH chart from TradingView
The potential BTCD decline and ALTCAP surge suggest that altcoins are likely to move up faster than BTC.
Click here to view the latest Bitcoin (BTC) analysis from BeInCrypto.
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