Bitcoin's Future Hinges on Tether Dominance: Analyst

Crypto analyst Justin Bennett has identified a key metric that could determine the direction of Bitcoin (BTC) in the near future. In a recent thread on the social media platform X, Bennett shared his analysis with his 115,800 followers, highlighting the significance of the Tether dominance chart (USDT.D).
The USDT.D chart shows the proportion of the crypto market cap comprised of the stablecoin USDT. A bullish USDT.D chart is generally considered bearish for Bitcoin and other cryptocurrencies, as it indicates traders are selling their crypto holdings in favor of the stablecoin. Bennett noted that Tether dominance has held above its previous range highs since February 5th and is now testing this area as new support.
Bennett believes that if USDT.D drops back within the range on the high timeframes, it would signal a bullish crypto market. However, if it cannot, Bitcoin and other cryptocurrencies could experience sideways to lower movements. Bennett emphasized that the key to a bullish outlook for Bitcoin is for USDT.D to lose the 4.37% level as support. Currently, USDT.D is at 4.47%, indicating that the support level is holding.
Bennett also suggested that Bitcoin may be setting the stage for a short squeeze, a phenomenon where traders who borrowed the asset at a certain price to sell it for lower are forced to buy back the assets they borrowed as momentum moves against them, triggering further rallies. With decent buy-side liquidity between current levels and $100,000, Bennett believes there is a chance that the sideways chop in Bitcoin's price could end with Bitcoin shorts getting squeezed, potentially pushing the price towards $103,000.
At the time of writing, Bitcoin is trading for $97,271, flat on the day. As the crypto market continues to evolve, analysts like Bennett will play a crucial role in helping investors navigate the complex landscape and make informed decisions.

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