CRYPTOCAP:USDT   Market Cap USDT, $ (CALCULATED BY TRADINGVIEW)
I know I'm not the first person to point out this relationship but I think it warrants another mention following the price action that we've been seeing. Following our breakdown from 8500 USD, we entered a downtrend. 7500 USD acted strong support and we went on to bounce off it ~3 times. Now, I think the fourth bounce would have been fatal for the bulls as it would completed a double top continuation and the big mutant H&S that we've been making for some time now. Further more, we were below both a big Ichi Cloud and the 200MA on the 4H.

This fourth bounce never happened because - at seemingly tactical points - after the third bounce, mysterious pumps would arrive out of nowhere and buoy the price up just as it was eyeing another bearish attack on support. Looking at the upper wicks on the hourly, this resembled a price being dragged higher without regard for consensus. Upon breaking out of the downward channel , there was no volume confirmation and the mysterious pumps continued to procrastinate the bearish downturn into never happening.

Anyway, to my point: I think this rally (like the 20k rally) is a Tether bubble. This chart highlights the correlation and the (roughly) month long delay that changes in Tether's market cap have on BTC's price. Anecdotally, look at the price action that we've been seeing and the charts that people have been posting: I found that both of these pointed to a healthy correction to ~$6.2k being on the cards and my analysis aligned with that too. Instead, what we have is a rally that can't correct. We breezed through the resistance at $6k having spent months leaning on it as support and now we're not even going to correct and retest it. This isn't the irrational exuberance of FOMO - I believe this is inflation by Tether and - if I'm correct - we should see a pretty steep rally to 10k soon; you've got to dance while the music's playing.

Best of luck on this crazy, one-way escalator and don't forget to keep an eye on the news re. Bitfinex, Tether, and the DoJ. If the Tether market cap starts shrinking or it gets canned all together, hold on to your hats.

P.S.: For those that think the correlation between BTC's price and Tether's market cap comes about due to demand for BTC producing demand for Tether, please check out the statistical analysis at Tether Report dotcom that debunks this and points much more strongly to tether being used to inflate BTC's price when it stagnates. For more on the 20k rally, look up Griffin and Shams.
Comment: https://uk.tradingview.com/chat/m/8f66c3...

As expected, there are (currently) no brakes on this train.
Comment:
Comment: Current Price: $9,348

One of the few points worth noting on this ride up is how bearish patterns are being ignored. If you watch the exchanges in real time, look out for the suppression of bearish momentum and the deliberate invalidation of bearish patterns. It's quite interesting to observe because - realistically - there are patterns and degrees of bearish momentum that would cause the house of cards to collapse on itself due to enough of the retail market being convinced to panic sell. Currently, at any time where the chart is telling you "this is it - time to sell", it ends up being a very good place to add to your long. Due to the recent chop, I wouldn't necessarily recommend doing this, but it's interesting nonetheless.

I've highlighted a double top and a bearish divergence on the hourly chart below to help make this point. The very convincing double top didn't play out; three guesses as to whether or not the bearish divergence does:
Comment: Current Price: $9,807

The bear div highlighted above did lead to a bit of a spill but no lower low.

10k is now within touching distance and based on the Tether market cap's growth rate from a month ago, this rally is not likely to stop anytime soon. As always, keep an eye on the news and manage your risk.
Comment: Current Price: $10,152

As predicted, BTC is now worth five figures per coin. Tether just minted another 100m USDT as well. I think this will be the last update of this idea as we've reached 10k. Enjoy the ride but don't forget who's driving.

Comments

Really interesting analysis at trying to get under the skin or behind the scenes of the price action we're seeing. I can't remember where I started follow you but pleased I did. Thanks
+1 Reply
Current Price: $9,348

One of the few points worth noting on this ride up is how bearish patterns are being ignored. If you watch the exchanges in real time, look out for the suppression of bearish momentum and the deliberate invalidation of bearish patterns. It's quite interesting to observe because - realistically - there are patterns and degrees of bearish momentum that would cause the house of cards to collapse on itself due to enough of the retail market being convinced to panic sell. Currently, at any time where the chart is telling you "this is it - time to sell", it ends up being a very good place to add to your long. Due to the recent chop, I wouldn't necessarily recommend doing this, but it's interesting nonetheless.

I've highlighted a double top and a bearish divergence on the hourly chart below to help make this point. The very convincing double top didn't play out; three guesses as to whether or not the bearish divergence does:
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K155MY4R53 K155MY4R53
Accidental - please see the update above.
Reply
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