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2 scenarios
Last cycle, in 2020/2021, the alt season started with a bang. A 15% drop in BTC.D over a month signaled the reversal. After 2 months of consolidation, dominance broke down even lower and within only 2 months it crashed by 35%. It seems at least reasonable to expect a somewhat similar outcome for this cycle. If so, altseason may have started a bit early in November this time. Interestingly enough, it has so far ended precisely at the new year as can be seen in the chart.
- Either altseason is already well underway with a nearly 10% drop since the reverse from 62% (see black pathway)
or - BTC.D will go for a final surprise breakout and revisit the 68% area where it will see resistance from the 2019 and 2020 highs (see blue pathway).
Or we could see a complete deviation from past patterns... but I'll stick to these two possibilities for now.
No 100x?
The drop from around 60% to 40% as indicated with the black line doesn't look like it would be much of an altseason. Back in 2021 the drop in dominance was over 40%. So essentially double. But if we think about how big of an alteason this cycle could be the dominance chart isn't definitive. It depends, obviously, on the performance of BTC. In other words, we could still see a very good season with a mere 20% drop if alts overperform and BTC somewhat paces along with them. In essence, we can't really judge about the performance of alts solely on this chart.
What this chart does suggest, however, is a gradual decline in BTC.D with a hard floor in the 40s. That of course can always be broken, but the support looks rather strong (blue line at the bottom). Perhaps the waves seen in the chart will slowly flat out - although I am certain the support will be tested at one time. With essentially infinite innovation, it seems rather unlikely that BTC will keep this much of the market share over decades.
Conclusion
If the past is somewhat of a guide, altseason may have already started or is about to start (it started in February back in 2017). So it's probably smart move to stack up on alts, considering that BTC will probably dominate the market for 3 long years by next year...
As a general reminder: Please keep in mind that none of this is official investment advice! Crypto trading entails a great deal of risk; never spend money that you can't afford to lose!
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