Over the past week, Bitcoin Dominance (BTC.D) has surged to 49.2%, a level not seen since April 2021. As concerns surrounding altcoins persist, more investors are turning to Bitcoin, resulting in increased demand on crypto exchanges. With BTC’s price showing positive momentum, will it soon surpass the crucial $27,000 resistance level?
Since June 5th, when the US Securities and Exchange Commission filed a lawsuit against Binance, the global altcoin market capitalization has experienced a 13% drop. In this volatile and uncertain climate, crypto investors are shifting their capital towards Bitcoin, attracted by its censorship-resistant qualities. Will this surge in demand for BTC push its price above the crucial $27,500 resistance level?
Bitcoin Dominance Reaches a Two-Year High
Over the past few days, Bitcoin Dominance (BTC.D) has increased by 2% to touch 49.3% for the first time in two years. BTC.D signifies the percentage of the global cryptocurrency market valuation made up of Bitcoin’s market capitalization.
The chart shows a steep rise in BTC.D from 47.21% on June 5th to 49.25% on June 12th.
A sharp increase in BTC Dominance suggests a shift in market sentiment and capital away from altcoins. Investors are losing interest in altcoins, resulting in BTC becoming the dominant market player. Given the 13% decline in altcoin markets within this period, the trend confirms that crypto investors are selling off their altcoin holdings to invest in BTC.
Interestingly, whenever there is a sudden surge in BTC.D, history shows that BTC’s price tends to rise correspondingly. Therefore, if altcoin prices continue to drop, this pattern may reoccur resulting in BTC’s price surging. Consequently, BTC holders may expect price-ups in the weeks ahead.
Crypto Traders Queue Up More Buy Orders
A further indication of the bullish outlook for BTC is the increase in buy orders queued up by crypto traders on exchanges. The Exchange On-Chain Market Depth chart aggregates the total buy/sell orders placed by Bitcoin traders on different exchanges.
The chart shows that, at present, BTC traders have placed orders to purchase an additional 24,000 coins. In contrast, sellers have only offered 21,000 BTC for sale.
When the demand exceeds the available supply for exchange, there’s upward pressure on the price as buyers compete to get their orders filled. Currently, there is a comprehensive shortage of 3,000 BTC available at exchanges, indicating that BTC’s price is likely to rebound once buyers increase bids to fill their orders quickly.
In summary, two critical factors, namely the supply shortage of Bitcoin and the increasing uncertainty in the altcoin markets, may drive BTC’s price dominance higher in the coming weeks.
BTC Price Prediction: The Critical $27,000 Resistance Level
Growing concerns among altcoin investors suggest that BTC prices will continue to dominate the charts and climb towards $29,000 in the weeks ahead. Nevertheless, IntoTheBlock’s In/Out of the money around price (IOMAP) data suggests that BTC will initially face resistance around the $27,000 mark.
According to the chart, two million investors purchased 866,000 BTC at an average price of $27,055. If BTC reaches that resistance zone, it may trigger a pullback. However, suppose BTC manages to surpass that resistance level. In that case, it could make its way towards $29,000, a level not seen since April.
It’s worth noting that the bears could invalidate the bullish BTC price recovery if it unexpectedly drops below the critical $25,200 support zone. But the 350,000 investors that purchased 206,000 BTC at a minimum price of $25,212 will likely prevent it. If the support level cannot hold, BTC could decline further towards $23,500.
Lastly, the United States Fed will be announcing its next Interest Rate decision on June 14th. As a result, strategic whale investors may decide to hold off on making significant trades until after the announcement.
Disclaimer
In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. Bitrabo is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions.
