[GUIDE] The BTC Dominance Chart & How To Read It

[CryptoMobster]

Hey everyone. Hope you all appreciate this one, certainly good if you hold a few altcoins at the same time as BTC.

Bitcoin dominance is a huge thing and often overlooked as a money flow indicator based on the %.

Higher the Bitcoin Dominance the more likely your altcoin satoshi value is going through the floor.

Likewise, if the Bitcoin Dominance is low your altcoins will be growing in value and it is often known as 'Alt-Season'

What do you need?

Go onto Trading View and check out a chart 'BTC.D' Which is basically the Market Cap BTC Dominance.

It looks like this.



Now I am going to teach you in a very basic format what you need to look for based off trend analysis on what to do with your portfolio at different points.

What you may want to use is a simple crossover method on the Daily or (any other tool you may know to discover the direction of the trend) Remember we are using the daily timeframe.

I use the EMA 8 Crossing the EMA 20 on the daily along with other trend indicators such as the RSI, MACD and Stoch RSI. But you only need to be on the correction trend direction.

RULES:

UPTREND = BTC DOMINANCE INCREASING = SELL ALT-COINS INTO USDT/Other stable coin or into Bitcoin. - Why? - You stop your Satoshi Values Dropping (Example Coming)
DOWNTREND = BTC DOMINANCE DECREASING = BUY ALT-COINS - Why? Alt-coins will increase in % over Bitcoin meaning you will increase your Satoshi Values.

April Altcoins (ETH) Vs April Bitcoin



See the difference?

Now let us look at that dominance chart again.


 
As the dominance rose so did the Bitcoin Price, but what dropped was plenty of alt-coins. Again check out the example below.



As that dominance kept increasing the altcoin value in BTC kept dropping.

I hope you enjoyed this. Please send some love, it would be hugely appreciated

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[pundit]

I am a forex trader and trade forex based on technical charts. I am trying to use the same concept in crypto but I am unsuccessful so far. For me this BTC dominance concept to trade BTC/altcoins is new one, it looks good, I will surely give it a try once I understand it. Thanks for elaborating this concept with examples but I still need to study it more. I will be looking for some more charts from you.

[CryptoMobster]

I am a forex trader and trade forex based on technical charts. I am trying to use the same concept in crypto but I am unsuccessful so far. For me this BTC dominance concept to trade BTC/altcoins is new one, it looks good, I will surely give it a try once I understand it. Thanks for elaborating this concept with examples but I still need to study it more. I will be looking for some more charts from you.

Thank you, I appreciate it. You will be seeing more

[CryptoMobster]

Would of expected more views and feedback from this. Pretty important

[carter34]

I am a forex trader and trade forex based on technical charts. I am trying to use the same concept in crypto but I am unsuccessful so far.

I was thinking the technicals of that of forex trading is same with crypto because they appear as the same both in the names too. But I don't really know if the outcomes interms of using them the same way is the same. I understand that bitcoin is highly volatile, that might make it look different .

[Wind_FURY]

OP, thanks. A basic guide that we can recommend for newbies who are considering day trading shitcoins. Although I usually recommend the Bitcoin HODL, your guide can also help them lose less by knowing when or when not to buy shitcoins.

[Kemarit]

Do we really need to plot Bitcoin's dominance though? I mean it will be obvious that if the dominance is going up, altcoin prices are down because investors and speculators shifts their funds around to which they will get a good value for this money. So it doesn't make sense to complicate things in your end, just saying. We appreciate your tips though.

[Haunebu]

Very useful guide op. The manner in which you detailed everything with illustrations was easy great and well put. I knew about this information, but I learnt some other stuff which I was not aware of.

Many people tend to downplay the dominance factor which is something that needs to be analyzed regularly.

[traderethereum]

To be honest, I feel too difficult to understand the chart. I don't know why, but I think that lesson is for the intermediate person who knows the basics of trading and for new people or for people who are not too active to trade, it could confuse to learn by the chart.
But that is a good lesson for every people on here which want to learn more about how to read bitcoin chart.
Thank you for the lesson, I am trying to learn step by step of your lesson, and I hope that it will give something a new lesson for me.

[CryptoLing]

Very nice guide, I hope many newbies read this and can truly understand the point of Bitcoin dominance when they see it on CMC.

Btw, if Bitcoin dominance is increasing it means two things. First, it means Bitcoin price is increasing and second your alt will likely to bleed.
However, it's not necessary to dump your bag of alts when the dominance up even your alts is bleeding. Always see it on 2 way, satoshi wise and fiat wise. I have experienced when my alts is bleeding (satoshi wise) but when I in fiat wise I'm still in profit. This is what's called the "Bitcoin dilemma", where you might get loss in satoshi but you still get profit in fiat, vice versa.

[Harlot]

Just speaking out of my experience here you see the thing is with BTC's dominance chart you can't really have a foresight on what is really happening, what it means is prices are either going up and down even after its chart it will say that is happening. So really Bitcoin's price dominance chart cannot really be useful in a day to day trade in which you want to jump over on something that hasn't move yet, it's like one of those indicators that couldn't tell anything at all.

[Xenrise]

A nice guide indeed for those who wanted to test the percentage of the dominance of bitcoin. This one is just to make sure what is the current btc dominance but for me, I'm just looking at CMC in order to see the dominance.

[BitHodler]

Would of expected more views and feedback from this. Pretty important

It's not your fault. Most people here think they are experts and don't need valuable input from others when it comes to trading, fundamentals or other important indicators that matter in trading.

Dominance has been quite an important metric so far, which I wanted to trade on, but unfortunately didn't do. The moment Bitcoin's dominance tanked to almost 50% flat it really looked like Bitcoin was undervalued, and it actually was.

Round total market cap in billions also matters a lot, which in Bitcoin's case was almost $100 billion and this time I did trade that event by shorting Bitcoin, and it worked out well for me. Some times you have to take that risk.

[vit05]

Very nice guide, I hope many newbies read this and can truly understand the point of Bitcoin dominance when they see it on CMC.

Btw, if Bitcoin dominance is increasing it means two things. First, it means Bitcoin price is increasing and second your alt will likely to bleed.

I disagree. Although the graphics can induce one to think so. There were periods when Bitcoin's dominance increased even as the price fell relative to the dollar. And it is always important to also have the dollar as a parameter.

Bitcoin is less volatile relative to the dollar than the overwhelming majority of altcoins. This everyone knows. It is an asset with greater liquidity, with the largest number of pairs with fiat, with the largest numbers of pairs with cryptos. But in this market, most seek volatility and in many cases the other cryptos offer greater risks, and in some small situations, they offer greater profits.

[Wind_FURY]

Do we really need to plot Bitcoin's dominance though? I mean it will be obvious that if the dominance is going up, altcoin prices are down because investors and speculators shifts their funds around to which they will get a good value for this money. So it doesn't make sense to complicate things in your end, just saying. We appreciate your tips though.

Although, will the two always be in opposition forever? I believe that it would depend on where the fiat investment directly goes, and shitcoins have been getting more through stablecoins, and they will be getting more.

[CryptoMobster]

I am a forex trader and trade forex based on technical charts. I am trying to use the same concept in crypto but I am unsuccessful so far.

I was thinking the technicals of that of forex trading is same with crypto because they appear as the same both in the names too. But I don't really know if the outcomes interms of using them the same way is the same. I understand that bitcoin is highly volatile, that might make it look different .

Each market is different. For example moving averages don't work always in the same way. Same for when you consider the use of certain crypto methods within the stock market. You got to papertrade and find what works. For me I always find that the fundamentals are very important due to how small the crypto market is, behaves different.

[CryptoMobster]

Do we really need to plot Bitcoin's dominance though? I mean it will be obvious that if the dominance is going up, altcoin prices are down because investors and speculators shifts their funds around to which they will get a good value for this money. So it doesn't make sense to complicate things in your end, just saying. We appreciate your tips though.

It is good for alerts. I set an alert to tell me what direction it could be going based on the methods above. If I know that gradually BTC dominance is going up, I'll keep an eye on my holdings to potentially sell to keep my BTC value. Likewise if it goes down, ill look to grow it with purchase to increase my BTC.

[CryptoMobster]

I appreciate all the merits! Was not expecting that. Thank you all.

Just to highlight if you found the chart too hard, I've made this one with less noise.

Hope this helps.

[sujonali1819]

Yes, the guide/information about The BTC dominance is really useful and really I am helped Because I have a little bit of confusion about The BTC dominance. Now I am calear about this. So thanks to providing this type of Guidepost. Hope you will keep it up.

[xvids]

Thanks for making this guide this would be really helpful for all of us,
And it would really help a lot for a newbie that wants to enter trading ,
It is important to know how to read the chart and how to use it .

[CryptoMobster]

I've also did a video guide on an element of trading

https://bitcointalk.org/index.php?topic=5141548.msg51018445#msg51018445

[Wind_FURY]

CryptoMobster, Bitcoin's dominance is slightly dropping, do you know of a way to graph in what altcoins most of the value have transferred to according to the altcoin's own dominance?

I believe you have something here.

[CryptoMobster]

CryptoMobster, Bitcoin's dominance is slightly dropping, do you know of a way to graph in what altcoins most of the value have transferred to according to the altcoin's own dominance?

I believe you have something here.

I do. There is a one called Total2 on Trading view which is all ALTs except BTC. When that goes up and BTC Dominance goes down. Alts rally and vise versa

[OrangeSeller]

When the price of bitcoin is going up The price of ALTCOIN tends to drop, majority of the times, this happens. I think this is because people likes to buy bitcoin and sell their ALTCOIN whenever see the price of bitcoin going up. And once they see that bitcoin has started going down they will start to sell their bitcoin and start buying altcoins and that will make the price of altcoins to go up while that of bitcoin (BTC) continues to fall . There are times that BTC can go up along with altcoins, but this can only be true for the top of the list altcoins like XRP, ETH, stellar, BCH and others. But the smaller ones will keep dying as these goes up cause they are getting dumped by traders.