By Shelly Melancon (Switzerland)
After setting a new peak rate of nearly 48% on October 20, the bitcoin dominance rate (BTCD) has declined. It has also been following a dipping resistance line during this period, resulting in a low of 39.98% late last week.
Analyzing The BTCD Using The Indicators
This low was close to the long-established 39.49% support region. However, the rate didn’t reach this long-term low before breaking from that resistance line to make a U-turn and move in an upward direction three days ago. If this upward momentum continues, the next resistance region would be 43%. This area acts as the Fib. retracement resistance and a horizontal resistance area.
The signs from the technical indicators are gradually turning bullish. The MACD and the RSI are on an uptrend. The MACD is about to cross into the positive region, indicating that the short-term MA is gaining momentum compared to the long-term MA. Also, the RSI is almost at 50; any value over 50 indicates bullishness.
BTCD Rate Prediction
Even though the daily chart indicators display signs of bullishness, those on the weekly timeframe indicate bearishness. The 7-day RSI currently shows a bearish divergence, a structure that prefaced the significant decline towards the 39% all-time low. Also, the RSI is not up to 50, with the MACD still in the negative region.
Also read:The downtrend movement, which started late last year, has completed four cycles. If this downtrend continues, it may likely complete the final cycle. The signals from the weekly chart indicate that an uptrend would be temporary, but the downtrend would likely remain for a long time.
1-week BTCD chart. Source: TradingView
Retail Traders Interested In Buying BTC At $48K – Data
Statistician Willy Woo has claimed that BTC has intense buying pressure like it was seen in Q1 2020. Woo opined that a crucial trend that only showed 18 months ago is appearing right now. Hence, it is no surprise that BTC accumulation is on the rise. Woo further claimed that during the end of the COVID heat last year, there was this high interest in BTC purchase.
“Even though the current BTC price is more than twelve times its price as of March 2020, the BTC accumulation interest remains high,” Woo remarked. As widely reported last week, a few BTC whales are reducing their BTC holdings, the majority of them are still keeping their holdings.
Meanwhile, the percentage of long-term BTC investors has reached peak levels. Glassnode’s ‘smart money gap’ indicator shows that the difference between BTC whales and BTC retailers is now more significant than ever.
Historically, local highs in this indicator (like it is currently happening) usually foreshadow the beginning of a bullish run. It remains to be seen whether it will be different this time. The data indicates that the 40% BTC price dip from its $69k peak price pushed out many short-term traders.
At Tokenhell, we help over 5,000 crypto companies amplify their content reach—and you can join them! For inquiries, reach out to us at info@tokenhell.com. Please remember, cryptocurrencies are highly volatile assets. Always conduct thorough research before making any investment decisions. Some content on this website, including posts under Crypto Cable, Sponsored Articles, and Press Releases, is provided by guest contributors or paid sponsors. The views expressed in these posts do not necessarily represent the opinions of Tokenhell. We are not responsible for the accuracy, quality, or reliability of any third-party content, advertisements, products, or banners featured on this site. For more details, please review our full terms and conditions / disclaimer.