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Altcoins market cap hits first support Bitcoin dominance weakening?The crypto market is currently undergoing a correction. How far the correction goes is still to be determined. That said, with altcoins in a fire-sale, for those wanting to get into this or that particular altcoin that just hasn’t so far given an entry, could this be the time to buy?
Bitcoin is flirting with the support at $66,000, and with the trend line that it has been respecting since early February. A further drop, even as far as $61,000 is not off of the table. With altcoins doing a whole lot worse, could a fantastic buying opportunity be about to present itself?
First, if investing for the longer term, one would have to think about whether the fundamentals for the altcoins in general are strong enough, before taking the risk to buy when the market is dropping, and it’s not known just how far it will go before a bounce materialises.
Altcoins market cap hits first support
Source: Coingecko/Trading View
The Total 3 chart (total market cap of all altcoins excluding $BTC and $ETH) is probably a good place to start, in order to see where the support levels are. As can be seen in the chart above, support at $700 billion has been reached. Further, even stronger support can be found below at $646 billion.
If we were to say that the $700 billion support holds, and of course the possibility of losing this level must never be discounted, then now might possibly be a very good time to start buying into certain altcoins. If there is a drop to the $646 billion level, even more of a fire-sale could take place.
Bitcoin dominance weakening?
Source: Coingecko/Trading View
Bitcoin Dominance is another chart to pay keen attention to when trading altcoins. Looking at the chart, it can be seen that bitcoin dominance is making a series of lower highs. It could also be taken that the price is falling each time to around 53%, which could be drawn in to form a descending triangle - a bearish pattern.
If dominance is rejected at 54%, it could be likely that there is a retrace to the bottom of the triangle at 53%, thereby giving some of the top-performing altcoins a chance to run. Of course, should dominance fall through the bottom of the triangle, altcoins could run a lot stronger.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
