As we start a new week bitcoin (BTC) price has made fresh declines below $8000 and has dropped to its five-month support area. A dip in market share and general cooling off could be good news for altcoins which appear to be holding ground at the moment.
Bitcoin Price Dumps to $7,800
Following the close of the fourth weekly red candle in a row, BTC has started this week bearish. A few hours ago the king of crypto fell back below support at $8k to around $7,800 after a weekend of relative stability consolidating at support.
According to Tradingview.com BTC tested resistance in the mid-$8k region 4-5 times and failed to break through indicating that further losses are imminent. Sentiment on CT is generally bearish with many eyeing a fall back to the mid-$7k level or even further.
One analyst, however, is looking to go long with a chart that shows clear support at current levels.
“It’s a new week, and Bitcoin is at support. I’m opening long positions in this area, in preparation for a movement upwards this week! Things are looking bullish, although that would be invalidated if we dropped below support,”
#Bitcoin: It's a new week, and Bitcoin is at support.
I'm opening long positions in this area, in preparation for a movement upwards this week!
Things are looking bullish, although that would be invalidated if we dropped below support ($7700) 📊 pic.twitter.com/Q0k2d1YBvR
— Crypto Welson 📊 (@CryptoWelson) October 7, 2019
Not all share that sentiment however and with BTC now firmly below the 200-day moving average it is getting deeper into bear territory.
The Bitcoin dominance chart also looks like it has reached its peak and is now starting to fall away. Trader ‘Crypto Bitlord’ tweeted on the obvious pattern in the dominance chart over the weekend;
“Even a noob can see it breaking down. What that means, simply, is altcoins are about to pump.”
Support levels for market share are currently at 66 percent and below that 63 percent with dominance at 69 percent at the time of writing.
Altcoins will be the first ones to benefit when bitcoin takes a breather. Total market capitalization has shrunk by a further $5 billion over the weekend but those have largely been due to the BTC decline.
Ethereum is holding on to support at $170 but as yet does not appear to have any independent momentum to take prices back to $200.
Today’s mover is Ripple’s XRP which has just spiked 6% to top out over $0.27 briefly. Industry observer Alex Saunders noted that this time it could be XRP that leads the altcoin revival and today it appears to be doing that.
— Alex Saunders (@AlexSaundersAU) October 7, 2019
Chainlink is another big mover today with a 9% pump to reach $2.20 but the rest are still waiting for their turns. The weaker bitcoin becomes, the more likely altcoins are to begin their long awaited recovery.
Is altseason around the corner? Add your thoughts in the comments below.
Images via Bitcoinist Media Library, BTC/USD charts via TradingView, Twitter: @CryptoWelson, @AlexSaundersAU