A simple but explanatory dominance analysis: the altcoin season

2022年4月7日

I’m coming up with a Bitcoin dominance analysis, as I have never shared one here. Before I say anything, I’m not really into altcoins (if we don’t count Ethereum), but I’ve seen some of them pop off, like Solana or Terra, which have been outperforming both BTC and ETH. This is the reason I think I have to show a broad analysis on the Bitcoin dominance before elaborating ideas about specific coins.

Firstly, alt seasons are periods of time when the majority of the altcoins have outperformed Bitcoin in the last three months, something that’s not happening right now. They’re also periods of time that indicate that we’re in a peak bull market, so it’s usually dangerous to trade it.

Now going to the chart, we see that we’ve been maintaining the nearly the same levels as 2017’s bull market, even though we retraced 50% from the all-time high. In a bearish scenario, the dominance would break the previous high sitting at around 47.5%. Similarly, in a bullish market scenario, we should break the all-time low (around 36%).

Sorry because I published this on Thursday but I wanted to work this out for you, so I hope you learnt a bit more about Bitcoin dominance and altcoin seasons!