Bitcoin Dominance Chart Indicates a Shift Towards Altcoins
Currently, Bitcoin holds over 50% of the crypto market, thanks to its regulatory acceptance, first-mover advantage, and strong brand. However, Bitcoin dominance experiences cyclical patterns where it loses its grip on the market to altcoins. These cycles, known as “altcoin seasons,” have occurred in the past and are expected to happen again.
Identifying Altcoin Seasons with Sine Waves
Sine waves, which are S-shaped geometric waveforms that oscillate periodically, can be used in technical analysis to identify cyclical patterns. By analyzing these waves, it appears that indicators are ready to roll over, suggesting that the next altcoin season might be on the horizon.
As Bitcoin continues to surge towards $40,000, retail investors who find it expensive will start searching for the “next Bitcoin,” triggering the next altcoin season. In previous cycles, altcoin seasons were sparked when Bitcoin reached significant milestones like $10,000 and $20,000. Now, with Bitcoin nearing $40,000 in 2023, altcoins may finally have their chance to outperform.
Hot Take: Altcoins Poised for a Comeback as Bitcoin Dominance Fades
The latest BTC dominance chart suggests that altcoins are poised for a comeback. With Bitcoin’s increasing price making it unaffordable for retail investors and historical patterns indicating an impending altcoin season, the tides may turn in favor of alternative cryptocurrencies. As retail investors realize the high price of Bitcoin and start searching for the “next big thing,” they may fuel the rise of altcoins. This shift could mark a turning point in the crypto market as altcoins gain more prominence and challenge Bitcoin’s dominance.
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