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Bitcoin price continued its upward trend, reaching its highest level since February, as optimism surrounding trade and economic conditions grew ahead of the Federal Reserve’s decision.

Bitcoin Climbs to $97,650, Boosting Market Dominance

Bitcoin surged to $97,650 on Wednesday, marking a 30% increase from its lowest point this year. This rally has elevated Bitcoin’s market dominance to 65.70%, the highest level seen since January 2021.

The rise in dominance comes as many altcoins, particularly Ethereum, continued to underperform. Ethereum’s market dominance has dropped to 7.5%, a significant decline from its peak of 22.27% in 2022. Its price faces risks of hitting record lows against Bitcoin.

Altcoins Struggle Amid Bitcoin’s Strength

Bitcoin’s dominance has been bolstered by its resilience, staying just a few points below its all-time high. Meanwhile, most altcoins remain significantly below their 2024 peaks. For instance:

  • Ripple (XRP): Down over 37% from its November highs.
  • Cardano (ADA): Dropped more than 50%.
  • Solana (SOL): Slumped by 51%.
  • Tron (TRX): Declined by 45%.

Wall Street demand has played a pivotal role in supporting Bitcoin’s growth. Spot Bitcoin ETFs have seen robust inflows, with assets under management surpassing $111 billion and cumulative inflows exceeding $40 billion.

Bitcoin Dominance: A Potential Pullback Ahead?

Bitcoin’s dominance chart indicates a strong rally, rising from a bottom of 38.86% in 2021 and 2022 to the current level of 65.4%. It remains above the 50-week and 100-week moving averages, with the Average Directional Index (ADX) climbing to 43. An ADX reading above 25 generally signals strong bullish momentum.

However, caution may be warranted as the dominance chart has formed a rising wedge pattern. Additionally, the Relative Strength Index (RSI) has reached an overbought level of 74.10, suggesting a possible reversal. Analysts predict this reversal could occur when dominance approaches 72.92%, a level last seen in December 2022. This shift may trigger a rotation back into altcoins.

Altcoins Show Signs of Recovery with Bullish Patterns

The altcoin market cap (excluding Bitcoin) presents a bullish megaphone pattern on the weekly chart, defined by two diverging upward trendlines. Recently, the market cap has retraced to the lower boundary of this pattern, hinting at a potential rebound as bulls target the upper trendline.

Additionally, altcoins have completed most of a bullish harmonic XABCD pattern and are now forming the final CD leg. As long as the market cap stays above the lower trendline, the probability of an upcoming altcoin season remains high.

For cryptocurrency enthusiasts and investors, keeping a close watch on market trends, technical indicators, and upcoming economic decisions will be crucial in navigating the evolving landscape of digital assets. Stay informed and monitor the latest developments to make well-rounded investment decisions.

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