BTC Dominance Hints What Bitcoin Price Could Do Next
Highlights
- Bitcoin price trades around $104,965, up 3.54% on the week.
- BTC dominance hovers just below 60% and is primed for a collapse, suggesting the start of a new phase.
- Bitcoin could hit all-time highs around $120,000, $150K to $200K, or even $250K.
Bitcoin (BTC) hit a new all-time high (ATH) on Monday as it shot up 3.79% in anticipation of Donald Trump’s inauguration speech. Since then, BTC has dropped 4.54% and currently trades around $104,965. With the short-term outlook uncertain due to the recent choppy movement, let’s look at BTC dominance and what that means for the long-term outlook of Bitcoin price.
Bitcoin Price Today
Bitcoin price today trades at $103,817.0 after dropping -1.91% in the past 24 hours. Despite this short-term pullback, BTC is up 3.54% this week and is still above the $100K psychological support level.
But the dominance of BTC is at a key level and hints that the next phase of the bull run will be lead to exponential rallies.
*bitcoin price updated as of 11 PM
What is BTC Dominance?
Bitcoin dominance is the ratio of BTC and total crypto market capitalizations. Currently, this metric stands at around 60%. Generally, a spike in dominance is attributed to capital flowing into BTC, which often happens at the start of the bull. During this phase, Bitcoin price explodes quite a bit while a majority of the crypto market sectors remain without growth. At a certain point during the cycle, BTC’s uptrend hits a ceiling, leading to profit-taking and capital rotation. This diversification from investors leads to capital flowing to more risky assets such as altcoins or meme coins. When this happens, BTC’s uptrend slows down or corrects while the rest of the crypto markets explode. This phase is termed “alt season,” where the rest of the crypto market undergoes massive expansion.
How Does Droppin Dominance Affect Bitcoin Price?
Since its inception, Bitcoin’s dominance has been dropping with each cycle, producing lower highs. The first major collapse in BTC’s market share happened in early 2017. During this ICO mania of 2017, many altcoins yielded multiple 100x returns. Despite this, Bitcoin’s price shot from nearly $2000 to $20,000.
The second drop in dominance occurred in late 2020 and early 2021, when the DeFi-based altcoins saw parabolic rallies. In the next year, Bitcoin prices exploded from $20,000 to $69,000.
During both these drops, Bitcoin exhibited similar price action fractals – a steady down-trending consolidation followed by a breakout and an up-trending consolidation. After these two signals were spotted, the value of BTC increased exponentially while dominance dropped.
History is repeating itself according to analyst TechDev. For most of 2024’s second half, Bitcoin’s price consolidated in a downtrending channel. A breakout from this range led to new highs. Following this, BTC’s price is ranging again but inside an up-trending channel, suggesting that an exponential rally is next.
With such an optimistic Bitcoin price prediction, let’s look at key levels to buy BTC ahead of its parabolic rally.
Key Levels to Watch if Parabolic Rally Kickstarts
The key support levels for Bitcoin include $100K, $96.6K, $95.3K and $93.2K. Investors can consider buying BTC if the price dips to this level.
As noted in previous articles, the next all-time high for Bitcoin could be $120,000, which is the 161.8% Fiboancci extension level of the recently formed range.
Beyond this, many banks in the US expect Bitcoin to form a top anywhere between $150K to $200K in 2025. For example, Standard Chartered is looking at a peak of $250,000 in 2025. CMT Analyst Adrian Zduńczyk is a firm believer that the next ATH for BTC could happen at $225,000.
The $150K to $200K range is a good place to book profits if Bitcoin price enters this range.
Frequently Asked Questions (FAQs)
1. What is BTC dominance and how does it affect Bitcoin price?
2. What happens when Bitcoin's dominance drops?
3. What are the key levels to watch for a potential Bitcoin price rally?
- XRP Treasury Holdings Hits $11.5B as Nasdaq-Listed Reliance Global Adds $17M in Fresh Buy
- FOMC Minutes, Jerome Powell Speech: Will Bitcoin Recover or Retrace Further?
- “Meme Coin SZN Is Here,” Says CZ As GIGGLE, 4 Price Skyrocket to All time Highs
- CZ’s YZi Labs Commits $1 Billion Builder Fund As Binance Coin Surpasses XRP
- Expert Sees LTC Crashing to $50 Even As Litecoin ETF Approval Reaches Final Stage
- Binance Coin Price Prediction If It Surpasses Bitcoin Marketcap— Is $3000 Possible in 2025?
- ASTER vs HYPE Price Analysis – Which Perp DEX Token Looks Poised to Dominate Q4 Performance?
- Ethereum Price Could Soar to $6,500 as BlackRock’s ETF Nears $20B Milestone
- Cardano Price Consolidates Below Key Resistance Ahead of ETF Verdict — Is a 50% Rally in Sight?
- Solana Price Eyes 56% Rebound Amid Solana Company’s Massive $530M SOL Acquisition
- Ethereum’s Price Bullish Cycle Resumes as Grayscale Launches Spot Staking ETPs – Is $7,331 Next?
Why Trust CoinGape
CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
