We spoke about the “Total Market Capitalization” on January 28th, 2022, when we mentioned how it found support on January 24th, 2022 at $1.5 Trillion (down from its $3 trillion high in November). The crypto market has added $500 billion to the marketcap since reaching the 24th January bottom, and now finds itself at the first major resistance at $2 trillion. What’s more, there is also a descending resistance trend line that comes all the way from 10th November, 2021, which is intercepting this resistance in the exact same spot. Considering the Stock RSI (stochastic RSI) on the 4 hour and the very high levels on the daily, we can expect a correction in the market at this point. The 0.618 retracement line is at $1.71 trillion, which is in the same area as the bottom, orange support line, so look out for a possible “bounce” in that area, in the next couple of days.
The second chart we look at today is the USDT dominance on the daily time frame. This is a very useful chart to help traders get an idea of the money flowing into the stablecoins, or into the trading coins. A rise in the USDT dominance chart will indicate a flow out of trading, into stablecoins. And, if we look at the USDT chart, we seem to be starting to “bounce” to the upside. We’re currently on the daily support line, which can be traced from November 10th, 2021.
The Stochastic RSI, on the 4 hour and the daily, are both at the bottom, indicating an imminent move to the upside, where money will flow into the stablecoins. The USDT dominance chart thus adds to a second confirmation as to an imminent pullback in the crypto market.
To sum up, these two charts are great to be looking at on a regular basis. They give you valuable clues as to the direction the market may take, and help to find the best opportunities for entering and exiting the market.