Bitcoin Dominance Hits 64%

Benjamin Cowen

Bitcoin Dominance Analysis

Bitcoin dominance has reached a new cycle high of around 64%, returning to its previous trend line. This is attributed to the continuation of quantitative tightening, which has not sufficiently changed.

Key Points

  • Bitcoin dominance is expected to continue higher due to monetary policy.
  • All coins are considered "oscillators at best" against Bitcoin, meaning their value fluctuates in relation to Bitcoin.
  • The expanding wedge pattern in Bitcoin pairs suggests a potential return to the historical support zone.
  • Quantitative tightening is seen as a key factor influencing Bitcoin dominance, with its continuation likely to lead to further increases in dominance.

Market Analysis

  • The altcoin market is struggling, with many coins dropping in value.
  • Ethereum (ETH) has gone down to 0.023, near its December 2020 levels, and is expected to continue struggling.
  • The ETH/BTC pair is likely to continue its downward trend, potentially reaching new lows.

Investment Strategy

  • Owning Bitcoin provides exposure to the upside while minimizing downside risk.
  • Being "Bitcoin heavy" is considered a better strategy than being "altcoin heavy" due to the potential for higher returns and lower risk.
  • Denominating a portfolio in Satoshis (Sats) rather than US dollars is recommended, as it can make the cryptiverse easier to navigate.

Conclusion

Bitcoin dominance is expected to continue its upward trend, driven by the ongoing quantitative tightening. Investors are advised to focus on Bitcoin and be cautious with altcoins, as their value is expected to fluctuate and potentially decline.