Bitcoin Dominance: The Grueling Final Rotation

Market Analysis & Prediction - The analysis suggests Bitcoin dominance is poised for an explosive move above 60% [1] - The analyst believes that understanding Bitcoin dominance is key to success in the cryptoverse [3] - The report anticipates that those expecting a rejection of Bitcoin dominance at the bull market support band will be mistaken, favoring liquidity flowing back to Bitcoin [9] - The analysis draws parallels with 2017, 2019 and 2020, noting similar patterns in Bitcoin dominance around October, suggesting a potential rally into the year-end [9][10][12][15] - The analyst argues that narrative follows price, not the other way around, minimizing the need to justify views based on the news cycle [8] Monetary Policy Impact - The analysis suggests that rate cuts by the Federal Reserve may not necessarily be bearish for Bitcoin dominance unless they fall below the theoretical neutral rate, approximated by the 2-year yield (around 35%) [17][18][19][20][26] - The report notes that the market (specifically the 2-year yield) dictates the Fed's actions, and the Fed is currently behind in responding to market signals [23][24][26] - The analysis indicates that if the Fed announces the continuation of quantitative tightening (QT) on the 29th, Bitcoin dominance is likely to surge [27] Risk Considerations - The analysis acknowledges that an earlier-than-expected end to quantitative tightening by the Federal Reserve could potentially invalidate the bullish outlook on Bitcoin dominance [16] - The analysis also notes that a potential government shutdown impacting the release of economic data could lead to the Fed cutting rates more aggressively (50 basis points or more), although this scenario is considered less likely due to rising inflation [21][22] Bitcoin Performance - Despite the continuous creation of new altcoins, Bitcoin pairs have been consistently declining throughout the cycle [30]