- Jacob Canfield predicts Bitcoin (BTC) will lead the crypto market until a BTC spot ETF approval, with BTC potentially reaching $48-$50k, while Ethereum (ETH) trails until then.
- Altcoins are expected to rise after Bitcoin’s dominance dips, with increased activity in Layer 1 coins, AI tokens, and gaming-related projects.
- Canfield advises focusing on projects in sync with Bitcoin’s trends, noting Ethereum’s influence on altcoin prices due to growing institutional interest.
Bitcoin Might Dominate for a While
Popular trader Jacob Canfield has been going on a Bitcoin rant lately, as he believes ETH will continue to trade behind Bitcoin. That is until an important announcement is made —the approval of a BTC spot ETF.
Canfield told his followers that Ethereum ($ETH) is expected to continue trailing behind Bitcoin ($BTC) until the announcement of an Exchange-Traded Fund (ETF), as he indicates by a chart comparing ETH to BTC.
The investor stated that a theoretical approval could make Bitcoin reach a local peak at $48-$50k, followed by consolidation within an 8-10% range. Moreover, Canfield anticipates that ETH/BTC will form a local bottom with a capitulation candle below support and then initiate a recovery.
Then we get a local blow off top for $BTC around $48-$50k and it probably will consolidate in an 8-10% range.
ETHBTC will probably then form a local bottom… pic.twitter.com/69eF178ZMw
— Jacob Canfield (@JacobCanfield) December 5, 2023
Altcoins Will Rise After a Break in the Bitcoin Dominance
Many analysts and crypto traders have been speculating on altcoins as soon as Bitcoin’s dominance plunges. As per data from TradingView, this metric remains well above 50%, a 30% increase year-to-date.
A key indicator preceding an altcoin season is a decrease in Bitcoin dominance, as traders seek alternative assets for higher returns. According to Canfield, altcoins have seen the most activity when Bitcoin consolidated in the $36k-$39k range. This included rotations between Layer 1 coins, AI tokens, and gaming-related projects.
The investor believes this is just the beginning of a massive altcoin rally. However, he advised his followers to recognize that Bitcoin will dominate the market for a while, absorbing liquidity, and the idea is to identify projects and coins that move in sync with Bitcoin for now.
Most altcoin projects are based on Ethereum, so when the price of ETH increases, the prices of these altcoins typically follow suit. The rising institutional holdings of Ethereum have intensified the attention on ETH’s price movements, indicating a significant factor influencing the altcoin market.