A closely followed crypto analyst is warning that the crypto market may not be done correcting based on one key metric.
In a new thread on the social media platform X, crypto trader Justin Bennett tells his 115,900 followers that the Tether dominance chart (USDT.D) is flashing bearish for Bitcoin (BTC) and other digital assets.
Many traders closely watch the USDT.D chart as it shows how much of the crypto market cap is comprised of stablecoin Tether (USDT). A bullish USDT.D chart is generally considered bearish for Bitcoin and other cryptocurrencies as it indicates traders are unloading their crypto holdings in favor of the stablecoin.
“You can’t help but feel we’re at pivotal levels right now in the crypto market. Tether dominance just secured its highest daily, three-day, and five-day close since early November, and this 4.4% area is serving as support so far this week.
Despite how some will react, I’m not making any bold calls (yet), as it’s too marginal, and this break from USDT.D could fail. That said, it’s something to be aware of and monitor this month. If we see Tether dominance drop back inside the range on the high time frames, specifically back below the 4.37% level, I’ll flip short-term bullish on BTC. Until then, caution is needed in my opinion.”
Next up, Bennett predicts that Ethereum (ETH) will chop around in the near term after reclaiming $2,600 as support.
“It was no surprise to see ETH bounce on Monday the way it did, considering it was at risk of losing a must-hold level at $2,600. But notice where Tuesday’s session closed relative to that key $2,800 level. Now take note of today’s high. I’m expecting sideways chop for now, but bulls aren’t out of the woods yet.”
ETH is trading for $2,705 at time of writing, down 1.9% in the last 24 hours.
Lastly, Bennett suggests that Bitcoin may revisit a range low of $91,787.
“Nice bounce from BTC on Monday from range lows, but not a great look with Tuesday’s session closing below the $98,000-$99,000 mid-range. Thinking we could see Bitcoin slide lower to target Monday’s lower wick.”
Bitcoin is trading for $96,713 at time of writing, down 1.6% in the last 24 hours.
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