Crypto Analysts Warn of Upcoming Altcoin Market Correction as Bitcoin Domination Soars

In a warning message to investors, a highly respected crypto analyst, Benjamin Cowen, highlighted the potential for a deep correction looming in the altcoin market. With a massive following of 783,000 subscribers on YouTube, Cowen asserts that historical trends show a significant decline for altcoins.

Cowen emphasized the strength of the Bitcoin (BTC.D) dominance chart, which suggests a bullish outlook as Bitcoin (BTC) approaches a halving event next year. The Bitcoin dominance index tracks the proportion of total crypto market capitalization held by Bitcoin. The bullish BTC.D chart implies that Bitcoin is gaining a larger market share at the expense of altcoins.

According to Cowen, “Basically, dominance is very bullish, and if dominance is bullish, it’s not profitable for the altcoins in their Bitcoin pairs. Moreover, the bullish dominance in the pre-halving year tends to be unfavorable for altcoins in their USD pairs as well. This is what history teaches us. However, it is not an absolute guarantee.

Cowen further noted that if the crypto king’s dominance rate surpassed 49%, it would signal a “risk aversion” scenario. Even if the price of Bitcoin has decreased, the level of dominance can still increase. He drew attention to an earlier example in May-June 2022 when Bitcoin price was falling, but its dominance was increasing.

Expressing his belief that capital will most likely switch from altcoins to Bitcoin, Cowen acknowledged that this process may take time. “Altcoin flowing back into Bitcoin is evident, and it’s a slow process… The altcoin market will probably continue to flow back into Bitcoin for quite a long time to come. Therefore, it is advisable to adopt a Bitcoin-focused approach until the altcoin markets suffer a significant pullback in their Bitcoin pairs and their dominance goes beyond the highs.”

Cowen urged investors to closely monitor Bitcoin’s dominance and its impact on the altcoin market. While an altcoin correction looks imminent, it is important to exercise caution and wait for confirmation via continued dominance above 49%. Only then, according to Cowen, should serious consideration be given to the altcoin market.