Bitcoin Dominance Rate (BTCD) continues to fall as ETH rises

The Bitcoin Dominance Rate (BTCD) has broken down from its long-term bullish structure, while the ETH/BTC chart shows upside potential.

Between May and December 2021, BTCD created a triple bottom pattern within the long-term support area of ​​39.50%. This is considered a bullish pattern, meaning it usually leads to upward movement. In addition, the pattern was combined with bullish divergence in the weekly RSI (green line).

While this initially led to an upward movement that took BTCD to a high of 48.45%, the price has since fallen. Furthermore, it broke from its bullish divergence trend line and the 50 line in early August.

This suggests that the upward movement may have come to an end. If so, BTCD would be expected to break down from the 39.50% support area.

Potential BTCD bounce

Cryptocurrency trader @BitcoinMacro21 stated that despite the ongoing decline, BTCD could soon initiate a strong rally.

The daily chart shows that BTCD has also broken down from a rising support line, which had previously been in place since the beginning of the year.

However, the daily RSI has fallen into oversold territory. The last time it was at this level (green icon), a significant upward movement followed.

If one occurs, the nearest resistance area will be at 43.50%, created by the previous rising support line and the 0.382 Fib retracement resistance level.

The possibility of a bounce is also supported by the six-hour chart, which shows that BTCD is trading within a descending wedge, and has generated bullish divergence in the RSI. A breakout from the wedge will confirm that the short-term upward movement has begun.

ETH/BTC

Since Ethereum (ETH) is the largest altcoin by market capitalization, movement is a big factor in changes in BTCD.

ETH appears to have started a five-wave uptrend in September 2019 (black). If so, it is currently in its fifth and final wave.

A potential target for the top of this move is between ₿0.117 and ₿0.121. The target is found using a 1.61 external retracement of wave four (black) and the length of waves one and three (white).

For Be[in]Crypto’s latest Bitcoin (BTC) analysis, click here

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