Bitcoin’s market dominance rate has been above 50 percent throughout most of its history. Its price initiated a rapid increase on October 25, likely as a results of an endorsement of blockchain technology by Chinese president Xi Jingping.
Since then, however, the Bitcoin price has been decreasing. To the contrary, a number of major altcoins — mostly Chinese based — have been surging. This has caused Bitcoin’s market dominance rate to decrease and many to call for the beginning of “altseason”.
If the dominance rate continues to follow the pattern laid out in September 2016, altseason is likely to begin within the next few weeks.
Cryptocurrency trader @beastlyorion stated that the dominance rate will fall rapidly very soon.
Time to pay attention! O_O pic.twitter.com/pXsvbYwiRD
— Beastlorion (@Beastlyorion) November 13, 2019
In order to make this predictions, he used a fractal from September 2016.
Let’s take a closer look at these movements and see if more similarities arise.
Bitcoin Dominance Rate
We analyzed the possibility of this fractal developing in our article from a few weeks ago. In it, we hypothesized that the Bitcoin dominance rate will start to fall rapidly on November 9. However, since a high was reached on October 28, the price has been gradually decreasing.
This has caused us to slightly adjust the fractal. With the new one, the rate of decrease will intensify on November 24 and will continue until February/March 2020.
One distinct similarity between the two movements comes from the position of the moving averages (MA). In the current movement, a bullish cross between the 50- and 100-day MAs preceded upward move.
Afterwards, a bearish cross transpired on the high of Ocotber 25, and both MAs have been acting as resistance to the Bitcoin price since.
In the 2016 movement, a bullish cross between the same MAs preceded the upward move. Similarly, a bearish cross transpired slightly before the rate of decrease accelerated rapidly.
The position of the MAs suggest that the dominance rate is at a similar position now like it was in March 2017.
After the high was reached in 2017, the dominance rate decreased by 55 percent. A similar rate of decrease would cause the dominance rate to reach an all-time low of 29 percent in the beginning of March.
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.
Images courtesy of TradingView, Twitter.
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