The cryptocurrency market got off to a swift and somewhat tense start to November. Bitcoin (BTC) is on its way to a record $73,000, but investors are having a tough week. Uncertainty over the outcome of the U.S. presidential election and the Federal Reserve’s expected rate cuts have heightened market volatility and put traders on edge.
Bitcoin’s Price Trends and Market Dominance
Last week, Bitcoin made a full effort to break through the key $73,000 level, but suffered a setback as bulls failed to successfully break through. The weekly close showed an inverted hammer pattern, sending mixed signals to investors. Despite the volatile price, Bitcoin's market dominance surged to over 60%, further consolidating its position as the strongest asset in the field and reflecting investors' continued confidence.
Altcoin market slows down
Meanwhile, the altcoin market seems to be stagnant. Bitcoin's growing dominance has overshadowed other digital assets and limited their momentum. Altcoin investors may need to be cautious at this time. Given Bitcoin's continued influence, the uncertainty of the direction of altcoins has also increased traders' concerns.
Why are altcoins held back?
The recent approval of several Ethereum (ETH) spot ETFs initially brought hope to the market, but the altcoin market has not seen a significant rebound. Although similar products such as Solana (SOL), XRP and Litecoin (LTC) are in the pipeline, overall demand is still lower than in previous bull markets. Investors can't help but wonder why altcoins are stagnant and when a new altcoin bull market will emerge.
Benjamin Cowen, a cryptocurrency analyst, said that the full boom of altcoins may not come until early 2025. He pointed out that the altcoin/BTC pair lost key support levels, which may indicate continued market weakness. However, Cowen also mentioned that any shift in Fed policy could provide altcoins with an opportunity to recover, which brings a glimmer of hope to the market despite the current market outlook.
Macroeconomic factors and market prospects
Macro factors continue to influence the cryptocurrency market. Seven months have passed since the fourth Bitcoin halving, but the market is still seeking balance. Influential analyst PlanB believes that the 2024 US presidential election may have a significant impact on the cryptocurrency industry, and new policies and possible regulations will affect investor decisions and price trends.
If the Fed cuts rates, it could herald the beginning of a new economic cycle, bringing investors opportunities as well as risks. As macroeconomic uncertainty persists, investors must proceed with caution from a holistic perspective. As previously reported by Bit Journal, the price of Bitcoin continues to influence the broader market. In this unpredictable trend, strategic thinking is more critical than ever.
The article is for reference only and does not constitute investment advice.
