Ethereum Leads Altcoin Decline Amid Bitcoin Dominance And Tax-Loss Selling

Key Points on Altcoin Decline and Potential Recovery:

Ethereum is leading a downturn in the altcoin sector, causing many cryptocurrencies to drop below key price levels.
Bitcoin's rising dominance indicates investors seek safety in Bitcoin, reducing capital flow into altcoins.
Tax-loss harvesting contributes to the sell-off of unprofitable altcoin positions as funds lock in losses before year-end.
The Federal Reserve's liquidity injections have not yet spurred market reactions, as improvements tend to lag.
The current market phase reflects patterns seen in early 2019 and 2023 recoveries, suggesting potential for future recovery rather than capitulation.

The decline results from interconnected factors: increased Bitcoin dominance, tax-loss selling, low liquidity, exhausted demand, and delayed macroeconomic impacts. This compression phase often precedes significant market recoveries.

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