Technical Analysis: Bitcoin Dominance (BTC.D) Continues To Rise, Raising Concerns For Altcoin Performance

The Bitcoin dominance index (BTC.D) is demonstrating signs of strength and appears to be targeting the range resistance level at 48.4%.

Long term range

BTC.D has been confined within a trading range of 39% to 48.4% since May 2021, and the price has validated both the support and resistance levels of this range on several occasions.

Following a bounce back from the 39% region on September 9, 2022, BTC.D established a bullish structure and broke above the midpoint of the range. This indicates that it will likely continue to move towards the range resistance level at 48.4%. The weekly RSI supports this possibility, as it approaches the overbought zone and slopes upward.

BTC.D weekly chart. Source: TradingView

Breakout above strong resistance

Additionally, technical analysis from the daily chart reveals a similar bullish signal. Rates have been trading within an ascending parallel channel since September 9, which is a corrective pattern that typically leads to breakdowns. However, the price broke out above the channel and confirmed it as support afterwards, indicating an impulsive upward movement.

The price then surged and broke through the critical resistance area at 43.6%-44.7%, formed by horizontal resistance and the 0.5-0.618 Fib retracement resistance area. This move signals a 100% retracement, suggesting that the price will continue to rise up to 48.4%.

BTC.D daily chart. Source: TradingView

Overall, it is highly likely that BTC.D will continue its upward movement and rally to 48.4%. As BTC.D represents Bitcoin dominance over the cryptocurrency market, this could impact the performance of altcoins, which are likely to continue to underperform against Bitcoin.

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