Altcoins
Five Factors Driving the Current Altcoin Season
Bitcoin price trading near all-time low old absolute recordand at a price that seems unattainable for many people wanting to own a whole coin, interest has once again turned to altcoins. BTC dominance has plummeted as a result, and at the same time, the dollar is breaking its support.
The past scenario created the perfect storm that resulted in the biggest altcoin season of all time. Is this incredible explosion of wealth creation about to happen a second time?
Ethereum, XRP and Litecoin: Major Altcoins Surge as BTC Dominance and Dollar Falls
During November, Bitcoin surged above its 2019 peak and surged another $5,000 beyond it. The surge sucked capital out of altcoins, but now that Full-Scale FOMO Is Back in the Cryptocurrency IndustryBTC profit taking into altcoins causes major altcoins to crash.
In November alone, Ethereum, XRP, and Litecoin all rose 50% or more. Ripple, which has been the worst performer in a three-year bear market, skyrocketed by more than 100%.
Crypto is back in a bull market, and while it will be strong, corrections along the way, the medium-term direction is probably upwards.
Related Readings | Here’s Why Cryptocurrency Analysts Are Divided On The Future Of Altcoins
Altcoins have had periods of outperformance versus Bitcoin in the past, but what makes this period special is that the dollar exchange index DXY has fallen at the same time.
In the chart below, Bitcoin and DXY dominance have only experienced one other prolonged crisis at the same time. The result was the 2017 crypto bubble and the greatest altcoin season of all time. Is history about to repeat itself??
The total altcoin market cap soared the last time BTC dominance and the DXY fell together | Source: CRYPTOCAP-TOTAL2 on TradingView.com
Why Bitcoin’s High Price and Weakening Dollar Are Triggering Altcoin Season
Beyond the technical aspects and graphics of the the two most dominant altcoins While trading pairs are clearly showing the same setup as last altcoin season, there are also fundamental reasons for this change in sentiment.
On the one hand, Bitcoin’s price perception could work against it in favor of altcoins. The high price of Bitcoin pushes participants towards cheaper altcoins.
Related Readings | Strange Correlation Between Bitcoin Dominance and Dollar Discovered
Dollar weakens amplifies the impact of this action and causes a massive breakdown of altcoins as a whole. These assets, like Bitcoin, have experienced a bear market and, after four years, could return to an uptrend.
If this is true and conditions are the same as last time, a new wave of incredible wealth will occur.
Featured image from Deposit Photos, Charts from TradingView.com