Altcoins Most Oversold Ever; Why Bitcoin Dominance May Soon Fall
After a jaw-dropping uptrend in Bitcoin dominance, all eyes have started to focus on the altcoin subset once again. You see, over the past couple of days, cryptocurrencies have begun to gain some strength against BTC for the first time in a blue moon, resulting in a slight Bitcoin dominance retracement from 71.2% to 69.7%.
While this may sound like nothing, analysts are starting to get convinced that altcoins are ready to continue to gain some steam at long last. Let’s take a closer look.
Related Reading: Bitcoin Price Shown Alongside Dollar and Euro in Square: Gone Mainstream
Altcoins Extremely Oversold
In August, we reported that Adaptive Capital’s Willy Woo remarked that altcoins were “heading into a region of support” at long last. This trend has continued into early-September.
The prominent on-chain analyst, known for his reports on how Bitcoin’s network effects equate to its value, remarked that the altcoin vs. Bitcoin market capitalization chart is “now two weeks into testing its 6.5-year support line”, which has yet to break. What’s more, the weekly relative strength index (RSI) of this chart is “more oversold [than its been] in its entire history”.
The story of global alt markets in a series of charts…
Altcoin vs Bitcoin cap now two weeks into being tested on its 6.5 year support line. Weekly RSI is more oversold than its entire history (has been since July!) pic.twitter.com/OUW8mBaEV8
— Willy Woo (@woonomic) September 8, 2019
Woo didn’t explicitly call for what cryptocurrency traders call an “altseason”, only claiming that altcoins may see “some bounce”. Yet, there are many that believe the limited run altcoins have been on will continue.
The Crypto Dog, a prominent analyst with over 100,000 f0llowers on Twitter, recently pointed out that the market capitalization of cryptocurrencies sans Bitcoin is about to break out of a descending wedge.
When #altseason?
soon pic.twitter.com/VY7TOdA9Ad
— The Crypto Dog
(@TheCryptoDog) September 9, 2019
Related Reading: Crypto Tidbits: PWC Branch Accepts Bitcoin, Ethereum Istanbul Pushed, Apple Talks Cryptocurrency
A Bitcoin-Centric Market
While the technicals seem to be in the favor of altcoiners, the narrative still seems to be one centered around Bitcoin.
As reported by NewsBTC previously, Anthony Pompliano, a Morgan Creek Digital partner, stated that Bitcoin dominance will only continue to gain steam. While the prominent investor didn’t mention an exact target, he expects his firm’s index, which includes nine leading altcoins, to naturally float towards a BTC dominance of 95% from the 80% where it stands today.
Prominent commodities trader Peter Brandt has echoed this line. In a recent tweet, the Bitcoin maximalist claimed that in five years, 99% of all crypto assets will be a distant memory.
Pompliano and Brandt aren’t just postulating.
There’s a reason why Bakkt is focusing on Bitcoin for its custody and futures solution, opting to only offer products for the leading cryptocurrency reason, or why Grayscale’s Bitcoin Trust has gained massive traction, but its Ethereum or ZCash Trusts have not.
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Nick Chong, Khareem Sudlow