Bitcoin recently surged above $60,000, fueled by important macroeconomic factors. Traders are anticipating a rise towards $70,000. The Federal Reserve’s recent meeting minutes hinted at potential rate cuts, which could increase Bitcoin’s price by increasing global liquidity through lower interest rates.
Looking at the bullish prospects, one crypto analyst highlighted that USDT’s dominance (USDT.D) could be a useful predictor of Bitcoin’s peak. As USDT.D usually trends upward over time due to coin distribution, it’s an important indicator.
USDT Dominance Dropping, Good For BTC?
According to a popular crypto analyst alias Mags on the X platform, Bitcoin’s price is en route to hitting a target of at least $72k or higher. Mags highlights a key observation about the relationship between Bitcoin (BTC) and the USDT Dominance (USDT.D) chart. He noted that USDT.D measures Tether’s (USDT) dominance in the crypto market relative to the total market cap of all cryptocurrencies.
Historically, there has been an inverse correlation between USDT.D and Bitcoin: when USDT.D decreases, Bitcoin tends to increase in value, and vice versa.
Current USDT.D Chart Analysis
The USDT.D chart must be understood to understand what’s happening. It compares the market capitalization of USDT, the world’s largest stablecoin, to USDC, DAI, FUSD, and all other USD-pegged assets. Mags pointed out that USDT.D has recently broken below a significant trendline support. This breakdown is crucial because it suggests a shift in market sentiment, potentially indicating that investors are moving away from holding USDT in favor of other assets. The chart now shows a possible bear channel formation, meaning that USDT.D might continue to decline.
Bitcoin’s Technical Setup towards $72K
Conversely, Bitcoin is forming a broadening wedge pattern on its chart. A broadening wedge is typically considered a bullish continuation pattern, suggesting that Bitcoin could experience a strong upward move after some volatility and fluctuations. This pattern generally indicates increasing volatility but with a bullish bias, signaling that the price might continue to rise once the pattern completes.
If USDT.D continues its downward trajectory, it could lead to a significant increase in Bitcoin’s price. Mags predicts this scenario could propel Bitcoin to $72,000 or even higher. The reasoning is that as investors shift away from USDT, they might put more money into Bitcoin, significantly driving up its price.
Source: https://coinpedia.org/news/top-reasons-why-bitcoin-btc-price-rally-is-on-horizon/