Bitcoin Dominance Hits 4-Year High at 64.94% Amid Altcoin Season Speculation

Bitcoin dominance has reached a new four-year high, sparking discussions about the potential start of an altcoin season. On May 2, Bitcoin dominance surged to 64.94%, the highest level since January 2021. This increase is primarily due to Bitcoin's strong performance, with its price climbing from $85,197 on April 21 to a peak of $97,470 on May 1, and maintaining levels above $97,000 at the time of writing. This price surge, combined with relatively slower growth in altcoins, has boosted Bitcoin's dominance.

This rise in dominance has been consistent since December 2024, with the rate increasing from 57.22% to over 13% in five consecutive months. However, this uptick has brought Bitcoin dominance into a historically significant resistance zone around the 65% mark. In the previous bull market of 2021, dominance at this level triggered a sharp reversal. Back then, Bitcoin dominance touched a near four-year high of 73.63% in early January 2021 but quickly fell, closing the month at 63.09%. February 2021 saw a short-lived rebound to 64.83%, but resistance held firm, and dominance eventually plummeted to 39.56% by September 2021. That drop, which lasted for over seven months, coincided with the explosive growth of altcoins, leading to the altcoin season.

Now, Bitcoin dominance is again testing that barrier. The monthly Relative Strength Index (RSI) for dominance has reached an all-time high of 72.22, signaling overbought conditions. Historically, such levels have preceded pullbacks. If Bitcoin dominance fails to break this resistance, a correction could ensue. The first significant support lies at the 0.786 Fibonacci retracement level of 59.35%, followed by the next major support at 54.97%. If this level also falters, dominance could retreat toward the 48.81% region, aligning with the 0.382 Fibonacci level. A pullback of this magnitude would likely translate to the long-anticipated altcoin season, during which altcoins outperform Bitcoin.

Several prominent analysts have discussed the potential turning point for altcoins. Michaël van de Poppe, the founder of MN Consultancy, has been vocal about the resilience and prospects of the altcoin market. On April 16, he noted that the altcoin season index had reached its lowest point in two years, coinciding with a sharp drop in the fear and greed index. He emphasized that market sentiment felt grim, which he viewed as a contrarian indicator that shows a potential turning point toward recovery. Three days ago, van de Poppe observed that the total market cap of altcoins was maintaining strength and had recently confirmed a successful retest. He suggested that this development laid the foundation for a move toward new all-time highs.

Meanwhile, pseudonymous trader Ak47 recently highlighted how the approval of altcoin-based ETFs in 2025 could contribute to the altcoin season. According to the analyst's forecast, Litecoin and Solana have a 90% likelihood of ETF approval, while XRP stands at 85%. Dogecoin and Hedera Hashgraph are forecasted at 80%, and Polkadot, Cardano, and Avalanche each carry a 75% chance. These projections have triggered expectations for a robust altcoin season if these ETF products eventually secure approval. Also, Crypto Tamil, another analyst, discussed the BTC.D chart today. He pointed out a bearish divergence on the daily Bitcoin dominance chart and argued that the metric is nearing its peak. He asserted that the conditions are favorable for a full-fledged altcoin season.