BTC dominance shows a steady downtrend: why this is critically important for altcoins

On the 12-hour timeframe, Bitcoin dominance continues to exhibit a pronounced downtrend. This metric is one of the most reliable indicators of the health of the cryptocurrency market, showing the share of BTC in the total market capitalization. As of February 13, dominance stands at 55.42%, significantly below the psychological 60% mark that we observed a few weeks ago.

Why dominance is a decisive factor: history of signals that worked

History shows that the third potential extremum mark on our indicator is an extremely reliable reversal signal. Analyzing data from the past months (January 15, December 19, December 3), we see that in most cases, such signals have played out with high accuracy. This is not a coincidence but a result of how market liquidity redistributes between BTC and altcoins.

Notably, during the last market decline, liquidity moved into stablecoins, creating favorable conditions for BTC dominance to rise. However, this increase is not a sign of market health but rather a sign of investors seeking refuge. The downtrend formed since the third potential low mark has demonstrated its strength, and the market has begun to re-evaluate.

Current situation: resistances and opportunities for altcoins

The key resistance level is at 59.88% — a horizontal level that has not been broken since November. Attempts to hold above this level (at 59.81%) have not been confirmed. We also monitored the 58.97% level, where the third potential low mark was formed, and the dynamics around it remain critically important.

The current chart position indicates the third potential high. A pattern resembling a “double top” with peaks between January 6 and 7 could be significant for future developments. However, the full formation of this pattern is only possible if dominance drops to 59.28%.

If dominance returns and consolidates below the critical level of 59.88% during this correction, it will create a positive scenario for the altcoin market. Such development is possible, although persistent downtrends on the daily, 2-day, and 3-day timeframes currently work against this scenario.

Key levels and forecast: what’s next

Today, there is tense situation on the 12-hour TF. Maintaining the downtrend on this timeframe remains a critical condition for a positive scenario. It’s important to understand that dominance is the key barometer of altcoin direction.

On the weekly timeframe, the picture remains favorable for a long-term decline in BTC dominance. As long as dominance stays below approximately 61%, this sustained weekly downtrend retains its strength. This suggests that a global decrease in dominance, beneficial for altcoins, remains a highly probable outcome.

Current BTC market capitalization relative to the total market cap (55.42%) is at an average level, leaving room for both further decline and a rebound. The market is in the process of re-evaluation, and the coming weeks will be decisive in determining whether altcoins will get a second life or if the previous cycle will end more ingloriously.

Final assessment: why this is a matter of survival for altcoins

BTC dominance is not just a metric; it’s a key signal of the overall health of the crypto ecosystem. History shows that the third extremum marks play out with impressive consistency. Monitoring the 12-hour downtrend remains critically important in the coming days, as any reversal could change the outlook.

The main takeaway is: dominance for BTC means suppression of altcoins, and a decline in dominance is an opportunity for alternative assets to recover. As long as the weekly downtrend remains below 61%, the potential for further decrease in dominance and corresponding growth in altcoins remains on the table. It’s essential to watch support and resistance levels, but the main trend currently favors patient investors betting on altcoins.