Bitcoin price may have held and confirmed a critical uptrend test of $ 10,000 and the "breast" bearish trend resistance from its all-time high. After such a bullish confirmation, the leading cryptocurrency by market cap may soon rise.
And if so, BTC dominance could signal that altcoins will flow to Bitcoin in the coming months. But it all depends on keeping a single line that, if lost, could send the crypto market to a fully developed sub-season.
BTCUSD Monthly Bullish Retest Holding Strong | Source: TradingView
Bitcoin Is Critical, Will Capital Flow From Altcoins To Top Crypto?
The above chart gives a very clear picture: Currently, the responsibility to keep the Bitcoin price above two very important levels lies in the bulls.
The first key level is the "meme" downtrend coming from an all-time high. This line has kept crypto prices stable for the past three years, and Bitcoin surpassed it in July. After the monthly doji candle signaled a pause in the uptrend, the crypto returned to retest the asset and confirm the resistance line as support.
This significant change of support and resistance could lay the groundwork for the future of the crypto market. It can cause serious FOMO in Bitcoin, but losing it could be bad for the leading crypto asset in terms of market capitalization.
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A doji at the top of the uptrend is also dangerous, making the current monthly candle and the candles after it much more important. A red candle falling at the second support level of $ 10,000 and closing monthly below it could signal an evening star pattern and send Bitcoin to a lower level.
However, Bitcoin dominance can hint at the best crypto outperforming the rest of the market, indicating that the re-test of the uptrend will be strong.
BTC.D Monthly Former Resistance Turned Support Holding | Source: TradingView
BTC Dominance Failure to Hold S / R Flip Could Lead to Altcoin Season, Possible Takeover
BTC dominance, the measure that weighs the market value of the first cryptocurrency relative to the rest of the altcoin area, is also a crucial moment.
BTC dominance is strong at a level that previously served as resistance on the road to the top of the 73% bear market. After breaking 61% dominance, the cryptocurrency rose another 12% and it reached its peak.
Related Reading | Five Signs That Bitcoin Dominance Has Bottomed: Are Altcoins Going To Zero?
But since then, it has been falling and increasing for over a year. BTC dominance returns to 61% – this is the only line that prevented a full sub-season from happening. If BTC dominance loses the streak, expect fireworks to show up in altcoins not seen since 2017.
Altcoins will not only sprout once again, but will regain their dominance if the bottom support line can be removed. But if BTC dominance closes October at over 62%, that target could be locked in for a very long time.
BTC.D Monthly Potential Morning Star Reversal Pattern | Source: TradingView
While a close above this level in September could create a tweezer bottom, a doji close here followed by a closing above 62% would trigger the morning star doji – a bullish reversal pattern and the equivalent of evening star formation mentioned earlier in relation to BTCUSD.
In such a situation, Bitcoin could skyrocket and leave the altcoins in the dust and postpone another sub-season for a much longer period of time. Domination shows signs that it is at a bottom, but anything can happen in the wild world of the crypto world.