The Bitcoin Dominance Rate (BTC.D) significantly impacts the development of altcoins in the cryptocurrency market. Some levels of BTC Dominance can be used to predict when the 'altcoin season' occurs:
BTC Dominance thresholds for altcoin season:
1. BTC.D below 40%:
• When BTC Dominance falls below 40%, it often indicates that capital is shifting from Bitcoin to altcoins. This is the phase when altcoins experience the strongest growth.
• Reason: Investors are seeking higher profits from altcoins.
2. BTC.D drops sharply in the range of 40%-50%:
• A rapid decline in this rate is a signal that capital is leaving Bitcoin and moving towards altcoins.
• This phase often marks the beginning of a strong growth cycle for altcoins.
3. BTC.D above 60%:
• When BTC Dominance rises high (above 60%), the market mainly focuses on Bitcoin.
• Altcoins will be 'suppressed' and struggle to make significant breakthroughs.
Other factors to observe:
• Market sentiment (Fear & Greed Index):
• Greed sentiment drives capital into altcoins.
• Capitalization trend (Total2 - Market Cap Altcoins):
• Monitor the total market cap chart of altcoins to determine when capitalization is rising sharply.
Conclusion:
• BTC Dominance < 40% is a good time to expect altcoins to rise significantly.
• Also monitor other factors such as market sentiment and cash flow on charts to optimize investment strategies.