Bitcoin’s dominance in the cryptocurrency market has surged, and analysts are warning investors to be extra careful in the coming days. While many calls for an alt season, Bitcoin (BTC) dominance has once again broken out above two-year resistance, which could lead to a massacre for altcoins.
A crypto trader who purportedly called Bitcoin’s (BTC) $60k top has once again taken to Twitter to warn investors to be extra careful in the next few days. According to Doctor Profit, BTC D broke out but dumped afterward below resistance two weeks ago, turning out to be a “fakeout” that pumped altcoins heavily.
🚩Be extra careful in the next few days regarding altcoins. People calling out for altseason while #Bitcoin dominance broke out today above huge two year resistance once again.
Two weeks ago BTC D broke out but dumped afterwards below resistance, turned out to be a fakeout and… pic.twitter.com/v6mLsHoDiq
— Doctor Profit 🇨🇭 (@DrProfitCrypto) April 30, 2023
However, he maintained that the weekly candle is now closing strong and above resistance, which should be the first warning sign for investors.
Bitcoin Dominance Could Murder Altcoins
Resistance being tested from time to time is a clear indication that something is not right. If the dominance continues to rise, and Bitcoin decides to dump, it could result in a massacre for altcoins.
“Such dumps will result in [an] easy -20% for alts in one day, and this will continue as long dominance keeps rising and BTC dumping.”
Meanwhile, he noted that the best-case scenario for the market would be if the dominance breakout turns out to be a fakeout, and Bitcoin pumps, which would take us to a new altcoin rally.
The cryptocurrency market is a complex and ever-changing landscape, and Bitcoin’s dominance plays a significant role in determining the fate of altcoins.
As Doctor Profit Crypto puts it, “Dominance pump + BTC pump = Altcoin dump; Dominance pump + BTC dump = Altcoin massacre; Dominance dump + BTC pump = Altcoin rally.”
This equation highlights the importance of monitoring Bitcoin dominance and its effect on altcoins. If BTC’s dominance and price increase, it’s likely that altcoins will suffer. But if Bitcoin’s dominance and price decrease, altcoins may experience a rally.
While this assertion might be correct, it is also essential to keep in mind that the cryptocurrency market is highly volatile, and anything can happen at any time. The key takeaway is that investors must stay vigilant and keep a close eye on the market to make informed decisions when investing in altcoins.
To all readers, doing your research, understanding the market trends, and investing wisely is crucial. One way to mitigate the risks of investing in altcoins during a Bitcoin dominance surge is to have a well-diversified portfolio. By spreading your investments across different cryptocurrencies, you can minimize the impact of any one asset’s price movements.