Key Points
- Ethereum has surged past $3,400, and its dominance has risen from 9.04% to over 11%.
- Meanwhile, Bitcoin dominance dropped from 66% to 62.89%, showing an incoming altcoin season.
- The Altcoin market cap is approaching a major breakout level and has strong bullish patterns forming.
Ethereum is once again in the spotlight as Bitcoin’s dominance slips. ETH is gaining ground against BTC in both price and market share, and the crypto market could be on the brink of another altcoin season.
Over the past week, Ethereum’s performance has outpaced Bitcoin’s. Also, technical indicators show that this trend may continue. As Ethereum breaks through key resistance levels, the altcoin market shows strong signs of life.
Bitcoin Dominance Drops as Ethereum Surges
To start with, Bitcoin dominance (BTC.D) measures how much of the total crypto market belongs to Bitcoin. Over the past few weeks, BTC.D has dropped sharply.
It has recorded a fall from a peak of 66% in late June to under 63% today. This fall shows that capital is rotating from Bitcoin to other assets, especially Ethereum.
Meanwhile, Ethereum’s market dominance (ETH.D) climbed from 9.04% to over 11%, showing growing investor confidence. ETH has appreciated more than 16% against BTC this week, indicating buyers favor Ethereum in this market phase.
Ethereum Price Breaks Out Above $3,400
Ethereum’s breakout above $3,400 has been a major turning point for the market. Analysts are closely watching the ETH/BTC chart, where a bullish breakout from the wedge shown below indicates that more gains could follow.
This breakout came from a golden cross between the 200 and 50-day exponential moving averages.
Alongside these moves, the total crypto market cap has risen 15% in July. This happened after hitting an all-time high of $3.80 Trillion. Most of this growth came from altcoins, especially those following the Ethereum trend.
Another essential chart investors have been watching is the TOTAL2. It tracks the market cap of altcoins excluding Bitcoin.
According to veteran trader Peter Brandt, this chart recently broke out of a bullish cup-and-handle pattern. In essence, the market is likely entering a new altseason.
Altcoin Index Strengthens
The Altcoin Season Index, which tracks the momentum shift from Bitcoin to altcoins, has jumped from 23 to 49 in just over two weeks. While still below the 75 mark (required to confirm a full-blown altcoin season), the rise shows that altcoins are gaining traction.
While this happens, several altcoins have outperformed Bitcoin in the last 90 days. The names of these altcoins include Sei (SEI), Bonk (BONK), Stellar (XLM), and XRP. If this trend continues, it could trigger a wave of capital moving into alt cryptocurrencies.
In addition, the CoinMarketCap Fear and Greed Index is currently at 70, showing that investor optimism is high. A reading above 60 typically means the market is in a risk-on phase. There, traders are more willing to invest in volatile assets like altcoins.
The rise of Ethereum in strength is playing a role in this shift. The more the cryptocurrency rallies, the more likely investors will rotate into other coins with strong fundamentals.
What can you expect next for Ethereum and Altcoins?
The entire altcoin market could follow if Ethereum continues on its current path. A significant resistance level for TOTAL2 is around $1.70 trillion, just below its 2021 all-time high. A weekly close above this level would likely be an essential indicator for the start of a new altcoin supercycle.
Peter Brandt noted that if TOTAL2 breaks this neckline, the altcoin market cap could rise above the $2 trillion mark. That would push the total crypto market cap beyond $4 trillion, another major milestone for the space.
However, the altcoin rally could stall if Bitcoin dominance recovers and Ethereum demand cools. For now, though, the technicals and sentiment remain in Ethereum’s favor.
