Bitcoin dominance index (BTCD) breaks down and approaches bottom of range

Bitcoin

‘s dominance index (BTCD) has been falling since July 30 and broke out of a rising wedge on August 11. Sponsored Sponsored

Both the trend and the wave count appear to be bearish, so a continuation of the decline towards a new all-time low (ATL) could occur

.

BTCD breaks

down The

Bitcoin Dominance Index has been rising inside a rising wedge since May 19. It consolidated inside this pattern until peaking at 49.24% on July 30. Since then, it has been moving downward.

Sponsored

On August 11, the breakout from the wedge occurred and since then the price has been moving downward at an accelerated pace. It is currently just above the support level at the 0.618 Fib retracement at 43.30%. If the price breaks down from this area, the next support will be at 39.60%.

The technical indicators are bearish. While the MACD has given a bullish reversal signal, it is still below 0. The RSI is also below 30 and the stochastic oscillator

has formed a bearish cross.

Therefore, it is likely that the trend as a whole is bearish.

Bitcoin dominance index (BTCD) breaks down and approaches bottom of rangeWskaźnik dominacji Bitcoina BTCD chart courtesy of Tradingview

Number of waves

Cryptocurrencytrader @Jackis_trader

has outlined a chart of Bitcoin’s dominance, stating that another decline towards a new ATL is likely. Bitcoin dominance index (BTCD) breaks down and approaches bottom of rangeBitcoin dominance index (BTCD) breaks down and approaches bottom of rangeSource: Twitter The

most likely wave count supports the possibility that Bitcoin’s dominance indicator will reach a new ATL.

If the current move is part of wave five, then the most likely downside target is in the 33.9-35.5% range. This range is determined by the outer Fib retracement of wave four (black) and the length of wave one (orange).

Bitcoin dominance index (BTCD) breaks down and approaches bottom of range <img src=”https://yellowrocketagency.com/wp-content/uploads/2021/08/BTC.D_2021-08-23_10-35-41.png” alt=” width=”1633″ height=”848″/>BTCD chartthanks to Tradingview

Correlation with B

TC

The

correlation

between BTCD (green) and BTC (orange) has been mostly negative for the past two weeks. This means that the increase in the price of BTC has caused a decrease in Bitcoin’s dominance index.

However, the relationship is not clear-cut. In the short term, the price increase has caused the BTCD to fall.

A continuation of the medium-term rise in Bitcoin’s price may actually cause BTC’s dominance rate to fall to a new ATL.

Bitcoin dominance index (BTCD) breaks down and approaches bottom of rangeKorelacja BTCD do BTC BTCD chart courtesy of Tradingview

For the latest analysis of Bitcoin (BTC) by BeInCrypto, click here

.

Explanation

All information contained on our website is published in good faith and for general information purposes only. Any action taken by the reader in relation to the information on our website is solely at the reader’s own risk.