Cryptographers have used Multiple gauges on the chain Indicators to analyze whether Bitcoin’s peak has already reached this bullish level or not. This time, cryptocurrency analyst Thomas pointed to USDT’s dominance to determine Bitcoin at the top of the market.
How USDT Dominance Predicts Bitcoin Top
Thomas claimed on X (formerly Twitter) mail who USDT Dominance He has predicted every local Bitcoin top over the past six years. He pointed out that there has always been a clear local Bitcoin top every time it touches USDT dominance. trend line bottomwhich the analyst highlighted on the chart. Thomas added that anyone using this metric would have sold the top every time in previous cycles.
The cryptocurrency analyst said it makes sense that USDT Dominance This analysis can be used to predict the Bitcoin top because the USDT-D trend over a longer period of time should be positive, as the currency is distributed over time. He added that USDT-D is important because the market is governed by swaps in and out of stablecoins.
Meanwhile, Thomas mentioned that USDT dominance can also be applied in reverse and used to predict Bitcoin local bottomHe noted that it has also been used to predict every local bottom in previous bear markets. The analyst acknowledged that the USDT.D indicator does not necessarily give an accurate estimate of the bottom, though he added that it “gives a good estimate.”
There may already be a local top for Bitcoin
Based on the chart shared by Thomas, Bitcoin’s local top may have already arrived, as USDT.D has once again touched the trend line the analyst pointed out. When one of his followers asked him if this was the case and if Bitcoin was heading to new lows, Thomas replied: He answered This is not necessarily what will happen, as the market could rally again and reach the lower end of the USDT.D chart, just as it did in last bull run.
The analyst is optimistic that this will happen, he said. He said He believes the market will retest the support line “multiple times over the coming months.” Ultimately, this means that Bitcoin has more room to run in this market cycle before reaching its bullish peak. Other cryptocurrency analysts, such as Rect CapitalHe has already confirmed that the cycle top has not yet arrived and that historical trends indicate that the market top will come sometime next year.
Meanwhile, Thomas revealed that he will be using the USDT.D trend line to guide his longer-term trades. Bitcoin/EthereumPlan to buy when USDT dominance is above the trend line and sell when it reaches the bottom.
At the time of writing, Bitcoin is trading at around $56,400, up over 4% in the last 24 hours, according to Data From CoinMarketCap.
Featured image created using Dall.E, chart from Tradingview.com