BTC.D Dropped Sharply, Money is Flowing into Altcoins
Bitcoin Dominance (BTC.D) has been rejected by the Fib resistance and created a bearish pattern. It is expected to continue to decline in the near future.
Bitcoin Dominance (BTC.D) has increased since confirming the long-term range resistance at 48.5% as support in the week from August 21 to 27, 2023 (green arrow). This move has brought it to the next resistance level at 54.5%, formed by the 1.618 external Fibonacci retracement of the previous decline.
After several weeks of consolidation, BTC.D was finally rejected by this level when it created a bearish engulfing pattern last week. This is a bearish pattern, often signaling a local top.
The weekly RSI indicator has created a significant bearish divergence and is cutting below 50. Both are bearish signals, indicating that the bear camp has regained control.
Therefore, BTC.D may retest the long-term range resistance at 48.5% once again.
Despite the bearish signals from the weekly timeframe, the daily chart shows a potential recovery.
BTC.D created a pin bar candlestick at the horizontal support area of 50.5% on January 14 and a small bullish candlestick on the following day. This shows that the bull camp is trying to defend this level.
The daily RSI indicator has created a hidden bullish divergence, signaling a recovery.
However, due to the strong selling pressure from January 9 to 13 (red arrow), BTC.D may only recover to the 0.382-0.5 Fibonacci retracement resistance level (52.29%-52.74%).
The most likely prospect shows that BTC.D will continue to decline to the previous long-term resistance zone at 48.5%. However, it may recover to the 52.29%-52.74% zone before continuing to decline.
Since BTC.D represents the dominance of Bitcoin in the cryptocurrency market, its decline shows that money is flowing into altcoins. This means that many altcoins will continue to boom in the future.
Disclaimer: Please note that this article is for informational purposes only and should not be taken as investment advice. As an investor, it is important to do your own research before making any decisions. We are not responsible for any investment decisions you make based on this information. Not Financial Advice.
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