Bitcoin’s main index may start to fall again if the price of Ethereum can make up for its 5% loss against BTC year to date.
Bitcoin
BTC
ground ticket
$22,399
it regains its lost power in the crypto market until now until 2023.
On January 30, Bitcoin accounted for 44.82% of the total crypto market, the highest since June. In the month of September, the Bitcoin rate was as low as 38.84%.
The index arises as many crypto investors reduce their exposure to smaller brands and seek safety in Bitcoin. Reasons include Bitcoin’s better liquidity and lower volatility than other cryptocurrencies, or altcoins, especially in bear markets.
Will Bitcoin market dominance grow?
As of January 31, Bitcoin is up 38% year to date at around $23,000. In comparison, the second largest cryptocurrency, Ether
ETH
ground ticket
$1,567
, gained 30% during that period, indicating that many investors continue to gravitate towards Bitcoin until now in 2023.
From a technical point of view, Bitcoin’s regulatory intervention may rise further in the coming weeks as it retraces its 50-week moving average (red wave in the chart below) to support.
By doing this, the index can rise to 48.5%, which is like resistance since May 2021.
On the other hand, the independent market analyst Rekt Capital sees the control contribution of Bitcoin rising to 46%, which coincides with the increase of the main bearish channel pattern, as shown in the monthly time chart below.
The short-term bullish trend on the control chart of Bitcoin shows that it fits the same trend in the Bitcoin market, and the bulls look to run higher towards $25,000.
Ethereum vs. Bitcoin is the main driver of BTC dominance
The cheap argument is that the contribution of Bitcoin may begin to disappear when it tests the resistance of its lower channel, as it has done several times in recent days.
Related: Bitcoin Sees Long Term Record in 2023 as BTC Price Tags $22.5K
“Bitcoin Dominance is spreading beyond the red in the Monthly TF,” said Rekt Capital, citing that the index from which the index usually runs a support line near 44.11%. The researcher added:
“One month near the top of the red could set BTCDOM up for another entry into the red that will benefit Altcoins.”
The above analysis looks like ETH is looking at a possible dynamic change against Bitcoin in the coming weeks.
Specifically, the pair ETH / BTC is consolidating near its support zone (yellow color) within 0.0676- 0.0655 BTC since January 24th.
The ETH/BTC pair may see a session ahead of its retracement (black) around 0.075 BTC if it continues to hold the support point. That, in turn, will reduce Bitcoin’s dominance in the cryptocurrency market as Ether’s share will rise to 20%.
