Bitcoin News Today: Bitcoin Dips 0.71% to $118K as Altcoins Plunge, Dominance Falls to 59.2%

The cryptocurrency market is witnessing an unusual disconnect as altcoins react to Bitcoin’s price action as if a breakdown has already occurred, despite ongoing retest phases in key support levels. Bitcoin’s recent pullback to $118,000 has triggered sharp corrections in altcoins, with traders interpreting the move as a bearish signal. However, technical analysis suggests the asset is in a retest phase, not a confirmed breakdown. This divergence highlights growing uncertainty in the market, as altcoin holders face amplified volatility and speculative shifts in capital allocation [1].

Bitcoin’s consolidation near its range low and lower high—common technical patterns—has not deterred altcoins from accelerating downward. Ethereum and Dogecoin joined broader market declines, while speculative tokens like BONK and FARTCOIN attracted inflows amid a 0.71% drop in Bitcoin’s value [2]. The altcoin market’s disproportionate reaction underscores a risk of premature trading decisions, as traders misinterpret unconfirmed signals. Bitcoin’s dominance fell to 59.2%, reflecting a shift in capital toward altcoins, with 71% of Binance Futures volume attributed to alternative assets by mid-July [3]. This trend, however, remains contingent on Bitcoin’s ability to stabilize.

Analysts caution that the current retest phase is a critical inflection point. If Bitcoin fails to hold above $116,000, broader sell-offs could follow, validating altcoin bearishness. A successful consolidation, meanwhile, might reverse recent altcoin declines and reignite market optimism. The interplay between Bitcoin and altcoins is further complicated by macroeconomic factors, including inflation concerns and potential U.S. tariffs. Piper Sandler analysts warned that Bitcoin could mirror equity market movements if these risks resurface, adding another layer of uncertainty [7].

DeFi protocols have already signaled caution, with a $1.7 billion liquidity outflow within 24 hours, and speculative projects like Pump.fun (PUMP) face pressure from delayed airdrops and liquidation waves [5][6]. Solana (SOL) and other resilient altcoins, however, bucked the trend, demonstrating how market dynamics are increasingly fragmented. Traders are advised to focus on confirmation signals rather than preemptive reactions, as premature exits could undermine potential altcoin rallies tied to Bitcoin’s stability.

The market’s reliance on Bitcoin’s performance remains unshaken. While altcoins have shown growing appetite amid Bitcoin’s consolidation, their trajectories remain intertwined with the leading cryptocurrency’s technical outcomes. As of mid-July, the market appears in a consolidation phase, with no clear directional bias. Investors are monitoring Bitcoin’s retest of key resistance levels, which could either reaffirm its support or trigger a cascading bearish effect across the crypto ecosystem [8].

Sources:

[1] [Bitcoin Dips Below $118,000—Discover the Driving Forces](https://www.instagram.com/p/DMb4Pc5qshG/)

[2] [Traders explore altcoins with Bitcoin dominance seeing fresh sharp declines](https://www.msn.com/en-us/news/other/traders-explore-altcoins-with-bitcoin-dominance-seeing-fresh-sharp-declines/ar-AA1J4ksr)

[3] [$100B Binance Futures volume backs traders' 'altseason' claim](https://cointelegraph.com/news/dollar100b-binance-futures-volume-backs-traders-altseason-claim)

[5] [DeFi Whales Pull $1.7 Billion in 24 Hours](https://www.mitrade.com/au/insights/news/live-news/article-3-981697-20250724)

[6] [Pump.fun Holders Sell at a Loss as Airdrop Delays Confirmed](https://coinjournal.net/news/pump-holders-sell-at-a-loss-as-pump-fun-founder-confirms-airdrop-wont-happen-soon/)

[7] [Bitcoin could pull back with equities in the coming weeks warns Piper Sandler](https://www.cnbc.com/2025/07/22/bitcoin-could-pull-back-with-equities-in-the-coming-weeks-warns-piper-sandler.html)

[8] [Bitcoin may drop if markets react to upcoming tariff or inflation risks](https://www.mitrade.com/insights/news/live-news/article-3-978516-20250723)