Bitcoin Dominance (BTC.D) is surging, indicating a potential shift in market sentiment towards Bitcoin. This trend could spell good news for BTC but potentially spell trouble for altcoins. Could an altcoin season emerge later in the cycle?
BTC.D is likely to move higher to 63.84% and 72.5%, which could signal excellent news for Bitcoin (BTC) but potentially disastrous for the altcoin market. This prediction stems from both price action and the rapid increase in Bitcoin Dominance ( BTC.D ) observed in recent hours. Historically, when BTC.D surpasses the 60% resistance zone, it has not been favorable for altcoins. However, there are glimmers of hope from stablecoin metrics.
Despite the recent market bloodbath, the increase in USDT Exchange Reserves over the past two years suggests a potential buying power surge within the market. This upward trend in stablecoin reserves could indicate that buyers are ready to step in, although it might take some time for them to fully assert themselves after the extreme liquidation event witnessed recently.Examining USDT netflows reveals a positive trajectory in recent weeks, particularly in November. This influx of stablecoins into exchanges could indicate a growing appetite for Bitcoin and potentially a catalyst for further price increases. Interestingly, previous rejections from the 60% resistance zone on the BTC.D chart occurred during the bear years following the 2017 bull run (2018 and 2019). This current retest, however, takes place within a bull market cycle, assuming the current upward trend persists.From a technical perspective, BTC.D's trajectory suggests a potential climb to 63.84% and 72.5%. This could be beneficial for Bitcoin but unfavorable for the altcoin market. As the market cycle matures and approaches its peak, an altcoin season could emerge, characterized by a sharp decline in BTC.D and substantial gains across the remaining cryptocurrencies. Capital might rotate from Bitcoin to altcoins, leading to significant opportunities for investors. Coins and tokens with strong fundamentals and unique value propositions could be the biggest beneficiaries of this trend.
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