Cryptocurrency analyst Dark Defender cautions that there is a crucial correlation between Bitcoin’s dominance and the timing of the XRP bull market.
According to the data, XRP typically enters a bull market only when Bitcoin’s dominance peaks and then begins to decline. In its latest analysis, Dark Defender confirmed that this pattern played out during XRP’s previous bull runs in 2017 and 2021.
Bitcoin Advantage and XRP Performance
Notably, during the early stages of the 2017 bull market, Bitcoin’s dominance soared to 96.25% in February 2017, putting pressure on the altcoin market, including XRP, which had been struggling during this period.
However, in March 2017, Bitcoin’s dominance began to wane, and XRP seized the opportunity. While Bitcoin was losing market share, XRP experienced a massive rally, soaring 284% in that month alone.
In the months that followed, Bitcoin’s dominance continued to decline and XRP soared, reaching an all-time high of $3.31 in January 2018. By that time, Bitcoin’s dominance had plummeted to 35.41%.
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Bitcoin dominance and XRP movement | Dark Defender
However, soon after, as dominance started to recover, XRP also faced a correction and the bull run ended. Interestingly, this inverse relationship between Bitcoin dominance and XRP performance played out again in 2021.
Specifically, by January 2021, Bitcoin’s dominance skyrocketed to 73.63%, which coincided with the low point of XRP price (down to $0.2082). Nevertheless, Bitcoin’s dominance began to decline in the same month, and XRP quickly rebounded, ending January with a gain of over 125%.
The rally continued even as Bitcoin’s dominance collapsed further, dropping to 49.19% by April 2021. XRP took advantage of this and rose to a high of $1.96 in the same month, despite the ongoing legal battle between Ripple and the SEC at the time.
Current status and future prospects of XRP
Dark Defender’s chart suggests that Bitcoin’s dominance has peaked once again, recently reaching a level of 59.75%. Market veteran Michael van de Poppe also points out this sudden rise in Bitcoin’s dominance.
of #bitcoin The dominance is still at its peak and could possibly turn around.
If that happens in the next few weeks (due to a reversal) $ETH And the labor market data is bad too), this is the craziest bearish divergence I’ve seen in a long time. pic.twitter.com/OYvWqVwR2W
— Michael van de Poppe (@CryptoMichNL) October 21, 2024
On the other hand, XRP continues to be in the situation at the start of the previous bull market, with poor performance. Market analysts believe that if Bitcoin’s dominance begins to decline in the coming months, it could create an ideal environment for altcoins like XRP to rally.
According to Dark Defender, a potential correction in Bitcoin’s dominance could occur between November 2024 and November 2025. This decline could trigger an altcoin season as capital flows out of Bitcoin and into altcoins, leading to significant gains across non-Bitcoin assets such as XRP.
In addition to historical patterns, the Relative Strength Index (RSI) shows that BTC.D RSI highs often coincide with the peaks of Bitcoin’s dominance. These RSI tops indicate overbought conditions.
Every time this pattern has occurred in the past, Bitcoin’s dominance has declined quickly thereafter. On the current chart, the RSI is approaching its peak again. A return to Bitcoin dominance could lead to a new cycle of XRP price growth.
Disclaimer: This content is informational and should not be considered financial advice. The views expressed in this article may include the personal opinions of the author and do not reflect the opinions of The Crypto Basic. We encourage our readers to conduct thorough research before making any investment decisions. Crypto Basic is not responsible for any financial losses.
