Altcoin season rages on as Bitcoin dominance (BTCD) slides
the Bitcoin Dominance Rate (BTCD) fell below two levels of long-term support. BTCD has fallen sharply since the start of the year.
The BTCD should continue to decline in the long term. The relationship with BTC is negative, which means that an increase in the price of the latter causes the BTCD to fall.
Long-term BTCD rupture
Cryptocurrency trader @TradingTank presented a bitcoin dominance chart, predicting a continued downward movement that should push the BTCD down to 36%.
Readings from the weekly period support this assessment. the MACD is negative and decreasing. Likewise, the RSI is declining and is currently below 30. Finally, the Stochastic oscillator made a bearish cross and is also moving lower.
An interesting development is that the BTCD has already fallen below the long term support level of 53%. Previously, the support level was held since October 2019. In addition, it has now fallen below the support level of the 0.618 Fib retracement at 49.7%.
The next support levels lie at 43.5% (0.786 Fib retracement) and 35.5% (2018 low).
Weak turnaround attempt
The daily chart is providing mixed signals. First, the BTCD path is bearish as it has not yet attempted to reach a higher low.
In addition, the technical indicators are bearish.
As the MACD rises, it failed to give a bullish reversal signal. The RSI generated a bullish divergence but is still in oversold territory. Finally, the Stochastic Oscillator rejected a bearish cross.
These indicators, however, are not enough to invalidate the bearish readings of the weekly period.
The six hour BTCD chart is also bearish. Along with the continued decline, technical indicators are bearish.
MACD decreases and RSI also decreases after generating a hidden bearish divergence.
Relationship with BTC
Since the April 25 rebound (black line), the relationship with BTC (orange) is negative. This means that an increase in the price of BTC resulted in a decrease in BTCD (green).
This is also visible by the correlation coefficient, which currently has a value of -0.5. A value of -1 would indicate a perfectly negative correlation.
Bitcoin’s dominance rate is expected to resume its descent to support levels at 43.5% and could potentially fall to 35.4%.