Bitcoin Dominance Displays Bearish Divergence Indicating Potential Altseason
Bitcoin briefly reached $108,800 but failed to maintain higher prices, reinforcing resistance below its all-time high. This has resulted in market caution, with volatility expected. Currently, Bitcoin trades below $109,300, leading traders to monitor for potential breakouts or pullbacks.
Analyst Ted Pillows highlighted a bearish divergence in Bitcoin dominance, indicating a possible shift from Bitcoin to altcoins. This trend occurs when BTC dominance rises while momentum indicators decline, suggesting that Bitcoin's strength may be waning.
- Bearish divergences often precede strong altcoin rallies as capital reallocates from BTC.
- Following global tensions resolution, Bitcoin surged above $105,000 but struggles to breach the $110,000 resistance zone.
- Market analysts note strong accumulation and improving macro conditions but express concerns over weakening momentum.
Historically, declines in Bitcoin dominance have led to sharp corrections in Bitcoin and robust altcoin rallies. Current geopolitical relief combined with technical signals suggests an imminent rotation might occur.
ETH/BTC Chart Shows Signs Of Reversal
The ETH/BTC weekly chart indicates a prolonged downtrend since late 2022, with Ethereum underperforming against Bitcoin. Currently trading around 0.0228 BTC, this ratio has not been seen since 2020.
- ETH/BTC shows signs of a local bottom above the 0.02 BTC zone after a significant drop.
- Selling momentum is slowing, and trading volume stabilizing could indicate a potential reversal.
- If Ethereum reclaims higher support levels amid declining Bitcoin dominance, the ETH/BTC ratio may rise.
A rotation from Bitcoin into Ethereum and other altcoins may signal a new phase in the crypto cycle where altcoins start to outperform.