Bitcoin Dominance (BTC.D) Approaches Critical Point, Signalling the Start of Altcoin Season

The Bitcoin Dominance (BTC.D), which measures BTC's share of the total crypto market capitalization, is approaching a critical point where the market could be preparing for a dramatic rotation into the long-anticipated altcoin season.

Bitcoin Dominance (BTC.D), which measures BTC’s share of the total crypto market capitalization, is approaching a critical point that could pave the way for a dramatic shift in the market with the long-awaited altcoin season.

A recent technical analysis, backed by historical patterns, suggests that Bitcoin’s current dominance could soon wane, setting the stage for a potential market explosion.

Bitcoin Dominance Timeline For Next Altcoin Season

According to a chart analysis shared by crypto analyst Astronomer on X (formerly Twitter), a gradual decline in Bitcoin Dominance is expected to kickstart the altcoin season explosion. Technical projections on the BTC.D weekly chart suggest that Bitcoin Dominance might complete a three-drive phase before collapsing toward crucial Fibonacci retracement zones.

For clarity, BTC.D is poised to decline through multiple key levels, beginning with the 50% psychological level, then 48%, potentially breaking down to the pivot zone at 40.68%, and finally to the bottom point at 36.03%. Notably, altcoin momentum typically intensifies once BTC.D falls below the 50% mark, with accelerated gains and explosive performance observed between 46% and 40%.

This forecast aligns with the October-November 2023 price behavior, where traders initially doubted the initial rally, only to witness a strong explosion shortly after. A similar shift in sentiment is expected this cycle, especially considering the recent fluctuations in Bitcoin’s price and the unstable market.

Moving forward, the analyst anticipates that the market is still on track for a substantial Bitcoin price breakout, possibly in late spring or early summer. This breakout is expected to set off a rapid pump in altcoins.

Until then, Bitcoin will likely continue its slow ascent, pulling BTC.D along with it until it reaches the top and begins to decline. In his post, Astronomer stated that the BTC price has already hit bottom, implying any delays to the start of altcoin season are primarily time-related rather than tied to price movements.

BTC.D Possible Fakeout To Open Path To Alt Season

The Bitcoin Dominance recently encountered a resistance zone at the 67%-70% level. This zone could be crucial for determining the potential of an altcoin season this bull cycle.

The resistance zone, identified in the chart analysis as the Quarterly Breaker Open, has historically marked the peak for Bitcoin Dominance before altcoins take the lead. After briefly touching this zone, BTC.D experienced a sharp reversal and is now at 64.62%. The rejection from this level aligns with the theory that the recent Bitcoin-led rally was a “fake breakout”—a move displaying strength before being quickly rejected.

Astronomer mentioned that he anticipated BTC to rise and sweep the “wick,” which ultimately occurred, pushing BTC.D higher in the process. However, once BTC.D spikes and begins to decline, following the pattern of fakeouts, it could signal the start of altcoin season, where alternative coins begin outperforming Bitcoin.