Altcoin Dominance Rising: Ethereum Leads, XRP and Litecoin Lag

Altcoin dominance broke above a significant resistance level, suggesting a further advance. The upswing could indicate the beginning of a new “altseason.”

Altcoins Could Gain Significant Market Share

At the peak of the 2017-18 bull market, altcoins were able to dominate over 67% of the entire cryptocurrency market capitalization. However, the last two years have throttled altcoin market share.

In early September 2019, altcoin dominance hit a low of 29%. Since then, an ascending triangle started forming on its 1-day chart. The altcoin price action shows a horizontal line across the swing highs and a rising trendline around the swing lows.

Earlier this month, altcoin dominance broke out of this continuation pattern, signaling the beginning of a new “altseason.” By measuring the height of the triangle, at its thickest point, and adding it to the breakout point, this technical formation estimates a 16% target to the upside. If validated, altcoins could soon capture 40% share of the entire cryptocurrency market.

Altcoin Dominance by CoinTrader.Pro

A look at Bitcoin’s dominance chart suggests that such a bullish scenario for altcoins is more likely.

Bitcoin dominance has been contained within an ascending parallel channel since the beginning of 2018. Since then, every time it hits the top of the channel, it retraces to the middle or the bottom. Conversely, when it reaches the lower boundary of the channel, it surges to the middle or the upper boundary.

After moving within this pattern for over two years, Bitcoin dominance broke the lower boundary of the channel in late January 2020. According to 45-years trading veteran Peter Brandt, “there is a tendency when you draw a parallel line equal to the distance of the height of the channel.”

Under this premise, Bitcoin dominance could run into significant support just under 59%. This is also where the 38.2% Fibonacci retracement level sits at.

Bitcoin Dominance chart by TradingView
Bitcoin Dominance chart by TradingView

Altcoins capturing greater market share…

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