Although bitcoin prices are falling rapidly, looking at events on the daily chart, one analyst believes the coin is preparing for a comeback, citing developments on the USDT dominance chart, or USDT.D.
USDT dominance falls, is it good for btc?
Leading to x on April 29, the analyst twitter.com/thescalpingpro/status/1784847809918943508″ target=”_blank” rel=”nofollow”>saying USDT.D recently fell, breaking below a critical support trend line. So far, USDT.D faces strong rejections at immediate resistance levels, indicating weakness.
All of this, while considering the inverse relationship the USDT.D chart has with bitcoin, the analyst now expects the world's most valuable coin to rise further, reversing recent losses and rejuvenating the broader crypto scene.
To understand what is happening, you have to understand what the USDT.D chart represents. In essence, it compares the market capitalization of USDT, the world's largest stablecoin, to the total market capitalization of other stablecoins, including USDC, DAI, FUSD, and any other USD-pegged asset.
This chart reflects USDT's dominance in the stablecoin scene. However, analysts have also been using this chart to gauge sentiment and correlation with bitcoin.
Unsurprisingly, USDT.D and bitcoin, analysts note, enjoy an inverse correlation. Since stablecoins like USDT act as a safe haven when prices crash, USDT.D will rise when btc prices crash and fall when bitcoin crashes.
Following the drop below the support trend line and the decline of USDT dominance, the analyst predicts that bitcoin prices will stabilize and even expand in the coming sessions. So far, btc is under pressure, declining more than 15% from its all-time highs.
Meanwhile, the USDT.D chart has encountered resistance. If rejected, it could signal the resumption of bitcoin's early Q1 2024 uptrend.
bitcoin Bears Move On: Next Stop at $60,000?
Currently, bitcoin is trending down but above $60,000. Despite the slowdown, the possibility of btc finding traction and expanding, even recovering $73,800, cannot be ruled out.
The analyst expects a “big breakout” for bitcoin if USDT.D continues to fall, aligning with the breakout of the support trend line. According to the analyst's projection, btc may surpass the all-time high towards $80,000 or even higher.
Still, although the analyst is optimistic, btc prices will not be guaranteed to skyrocket due to the reduced dominance of USDT.
Changing market dynamics, including institutional adoption through spot bitcoin exchange-traded funds (ETFs) and even regulatory developments, such as the United States Securities and Exchange Commission (SEC) initiating charges against stablecoins As it did with BUSD, it can affect the prices of bitcoin or USDT. domain.
Featured image from Shutterstock, chart from TradingView
Disclaimer: The article is provided for educational purposes only. It does not represent NewsBTC's views on whether to buy, sell or hold investments, and investing naturally carries risks. It is recommended that you conduct your own research before making any investment decisions. Use the information provided on this website at your own risk.
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