In this episode of NewsBTC’s daily technical analysis videos, we’re looking at the dominance of Bitcoin (BTC.D) and how the top cryptocurrency could perform against altcoins in the short term.
Take a look at the video below:
VIDEO: Bitcoin Dominance Versus Altcoins (BTC.D): October 20, 2022
In addition to the video highlights listed below the video, we also analyze BTC.D using Ichimoku, Average Directional Index, LMACD, and other technical tools.
Bitcoin Outperforms Altcoins During Sideways Phase
On the daily time frames, BTC.D is taking a brief hiatus but is still mostly bullish according to price action and technical indicators. Dominance is above Tenkan-sen and Kijun-sen on the Ichimoku, while it turned bullish on the LMACD. The average Directional Index at the bottom shows that the strength of the trend is weakening on the daily time frames and the bulls have the upper hand.
Bitcoin is has been outperforming altcoins | Source: ETHUSD on TradingView.com
Related Reading: Bitcoin Price Action Falls Flat | BTCUSD Analysis October 18, 2022
Why Altcoin Season Might Be Over For A While
On weekly time frames using the same tools, we can see that dominance has just turned bullish against altcoins, and the average Directional Index hints that this trend could strengthen soon. In Ichimoku, dominance is above Tenkan-sen, but not Kijun-sen, making it the next logical target.
Moving to monthly timeframes, Bitcoin dominance is also bullish against altcoins on the LMCD, with ADX showing altcoin season could be cooling off for some time. The Ichimoku isn’t very revealing, but just like the weekly time frames, the previous Kijun-sen could become a possible next target.
Can Alts hold 50% crypto dominance?
Additional trendline TA shows that BTC dominance has possibly retested the neckline of a years-old inverse head and shoulders pattern, including the early 2018 alt-season peak that occurred shortly after Bitcoin topped $20,000 in December 2017. Surprisingly, Bitcoin is trading below that level some five years later.
If Bitcoin dominance reverses strongly against altcoins, the line in the sand to watch is around 52% dominance. Above would trigger the first monthly buy signal for Bitcoin against altcoins.