Why the price and volume of Bitcoin are rising together is bad news for Ethereum, altseason

189
SHARES
1.5k
VIEWS
ADVERTISEMENT


Bitcoin (BTC) soaks up the volume of the entire cryptocurrency market as it continues to recover. This is causing the alternative cryptocurrency (altcoin) market to retreat, which has resulted in increasing selling pressure and low buyer demand.

On October 30, Santiment researchers noted the growing volume and dominance of Bitcoin while Chainlink (LINK), Ether (ETH) and Binance Coin (BNB) were struggling. They write:

Related articles

“The dominance of #Bitcoin is still evident, especially in terms of trading volume. When comparing other top blockchains over the past day, note the drop in trading volume from ETH, XRP, LINK and BNB while the level of BTC remained high. “

At least in the foreseeable future, traders believe that the so-called “old season” will not return, especially since Bitcoin will outperform Altcoins.

The trading volume of Bitcoin against other major cryptocurrencies. Source: Santiment

When would altcoins recover?

Historically, Bitcoin initially experienced a rapid upward trend during the bull markets in the cryptocurrency market. Altcoins then followed after BTC hit a local peak or an all-time high.

Traders anticipate a similar pattern in the current price cycle and generally expect altcoins to rebound in 2021. However, until BTC stabilizes and completes its rally, traders will not see a proper uptrend in altcoins.

Since the September 13 lows, the Bitcoin Dominance Index has risen from 56% to 63.4%, rising 7.4% in two months.

The Bitcoin Dominance Index. Source: CoinMarketCap.com

However, Michael van de Poppe, a full-time trader on the Amsterdam Stock Exchange, said a mid-season is possible in the first quarter of 2021. He said:

“Dominance hit the red zone here. I’m still waiting for a top structure until December. Then -> mid-season 1. “

The problem with altcoins is the current dynamics of the cryptocurrency market. When bitcoin is rising rapidly, altcoins will fall when capital returns in BTC. When BTC falls, altcoins collapse, placing altcoins in a precarious position.