Is Bitcoin Dominance About To Give Way To Altseason? Analysts React

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As a seasoned researcher with over two decades of experience in financial markets, I have seen my fair share of market volatility and trends. The recent dip in Bitcoin (BTC) and the overall crypto market, following Jerome Powell’s hawkish remarks from the Federal Reserve, is an interesting development that I find myself intrigued by.

Bitcoin’s price dropped from a peak of $108,135 on December 17 to $99,500 yesterday, after Federal Reserve Chair Jerome Powell made hawkish comments. Nevertheless, certain crypto experts are optimistic about a possible decrease in Bitcoin’s dominance (BTC.D) which could lead to an ‘altcoin season’.

What Caused The Crypto Market Crash?

Over the last 24 hours, there’s been a significant drop in the overall value of the cryptocurrency market. Approximately 6% of its total worth has diminished, with most losses occurring in altcoins. In actual figures, this translates to a loss of around $200 billion from the crypto market within this timeframe.

As a researcher examining market trends, I observed that the cautious remarks made by Powell seemed to initiate a downturn within the cryptocurrency sector, hinting at the ongoing struggle of the Federal Reserve against inflation. Intriguingly, Powell implied that there might be merely two potential interest rate reductions in 2025 as opposed to the previously anticipated three.

Moreover, the Federal Reserve has boosted its projected inflation rate for 2025 from 2.1% to 2.5%, and it’s keeping a steady 2.1% forecast for 2026. This is above their desired rate of 2%. The Fed anticipates that inflation could linger for another two years, leading to higher-than-expected interest rates lasting longer than previously thought.

In response to Powell’s remarks, the cryptocurrency market has shown signs of distress, leading to over $850 million worth of liquidations within the last 24 hours. However, some crypto experts see this dip as a chance to purchase altcoins, predicting that BTC.D may decrease further in the near future, potentially offering opportunities for investment.

Is Bitcoin Dominance About To Collapse?

Over the past two weeks, Bitcoin Dominance has been steadily increasing on a weekly basis, climbing from 56.24% to 58.50%. Some experts believe that this upward trend in BTC.D could signal a lower high, potentially leading to a significant drop and setting the stage for an altcoin boom, or ‘altseason’.

Bitcoin expert Eric Crown expressed his insights regarding the BTC.D chart. He pointed out that the metric could potentially dip to around 54%, following a minor uptick to approximately 59%.

As a crypto analyst, I’ve observed that we might have seen the peak of Bitcoin Dominance (BTC.D). It is anticipated that the surge in altcoins, often referred to as ‘altcoin season’, will persist once BTC.D faces rejection at resistance levels ranging from 58% to 59%.

In a similar vein, Bitcoin expert and analyst Seth has pointed out the tendency of BTC.D in previous market phases. He suggests that it could repeat this pattern during the current cycle, with a possible consolidation near a significant support level approximately at 58%, followed by a potential decline.

Arthur Hayes, a previous CEO of BitMEX, has recently expressed his perspective on the crypto market. He anticipates a significant drop or “harrowing dump” close to the inauguration of President-elect Donald Trump, scheduled for January 20, 2025. At the moment, Bitcoin is trading at $100,978, marking a decrease of about 3% over the past day.

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2024-12-20 16:41