Bitcoin’s dominance (BTCD) could drop to new all-time lows

Bitcoin Dominance (BTCD) has been hovering along a descending resistance line since July 30, and has just fallen below the 41.30% support area.

Technical indicators and price action suggest it is likely to hit a new all-time low.

Potential double floor

BTCD has been down since January when it hit a high of 73.65%. The decline lasted through May 19, culminating in a low of 39.66%.

BTCD recovered at the time, but fell back into the 40% zone. This creates a potential raised floor.

The double bottom is viewed as a bullish pattern and there are several potential bullish reversal signs, such as a bullish divergence in the RSI.

However, both the divergence and the pattern have yet to be confirmed as lower values ​​could invalidate them. In addition, the MACD is falling and last week it created a lower momentum bar (red symbol). Additionally, there is a risk that the RSI could drop below 30.

Hence, there aren’t enough bullish signs to confirm a bullish trend reversal.

BTCD weekly chart | Source: TradingView

New all-time low?

Trader @TheEuroSniper sketched the BTCD chart and said a close below the 40% zone could result in a fall to 32%.

The source: Twitter

The daily chart also paints a bearish picture. BTCD has been falling along with a descending resistance line since July 30th.

In addition, the price fell below the 41.50% support area on September 8th and is currently in the process of confirming this as resistance.

The technical indicators are also falling. While the RSI is likely to create a bullish divergence, it is still below the 30. Furthermore, the MACD is falling.

A decline below the May 17 low of 39.66% would likely push BTCD to its 2018 low of 36%.

BTCD daily chart | Source: TradingView

The most likely wavenumber indicates that BTCD is on the fifth wave of a bearish pulse (orange).

The potential target for the bottom of the movement is the 33.89% – 35.85% zone. It was found based on the length of wave one (orange) and the 1.61 retracement FIb level outside of wave 4 (black).

The 33.89% level would mark a new all-time low.

BTCD daily chart | Source: TradingView

You can see the BTC price here.

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Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.

SN_Nour

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