Development Will Increase Whales’ Risk Appetite for Altcoins

Despite experiencing selling pressure a few months ago, Bitcoin has managed to remain robust. On-chain data reveals significant BTC transfers on the Coinbase exchange. However, we can’t apply the same sentiment to the altcoin market.

What we need is an environment where Bitcoin is strong, but Ethereum is even stronger. If the ETH/BTC ratio remains favorable, this0 could be the right direction. We require a reason to reduce Bitcoin’s dominance and empower ETH/BTC, encouraging smart investors, speculators, and whales to take a more enthusiastic stance in altcoins.

The primary driver behind this shift is undoubtedly the immense demand for Ether. In this context, the launch of spot ETH ETF trading could unlock numerous opportunities.

Bloomberg ETF analysts anticipate that Ethereum ETF S-1 approval will be released before July 2. Consequently, ETH ETF trading is expected to commence on July 3.

Nate Geraci, an ETF analyst, emphasizes that the potential positive impact of a spot ETH ETF has been significantly underestimated.

Now, let’s explore how Bitcoin’s dominance and the altcoin market cap might be affected if spot ETH ETF trading begins in July.

Between April 2021 and 2023, Bitcoin’s dominance remained within the red and deep blue zones. As Bitcoin rallied, it broke through the red resistance, and the purple area eventually touched the yellow primary resistance zone.

We observe a wedge-shaped structure, gradually ascending in this region. There are signs of weakness, which could favor ETH and altcoins in the medium term.

Rumors suggest that spot ETH ETF trading will also be prepared in July. If the wedge structure breaks downward, the purple area will serve as initial support.

Should the purple area break down, we might find ourselves in a crucial sub-season.

Now, let’s assess how Bitcoin dominance (BTC.D) might change on the candlestick chart in this scenario:

The 51 and 48 levels are critical for BTC.D. With the start of ETH ETF trading, we could witness BTC.D declining to either of these levels. The expected major altcoin trend will likely occur while BTC.D enters the red zone.

BTC.D approaches the upper limits of the monthly and bimonthly time frames. With the ETF, the wind may shift toward altcoins. Of course, there are many altcoins, so choosing wisely is essential.

Sentiment: Neutral