How does the next chapter in the history of Tether printing for Bitcoin unfold?
If Bitcoin reacts to the recent substantial printing of more Tether stablecoins in the same way it has in the past, we may finally have a catalyst for the crypto asset to retest its previous all-time high.
According to an ongoing correlation suggesting that Bitcoin gets pumped up with each new chapter in the Tether saga, the leading cryptocurrency by market capitalization history in 2020 could culminate with a very happy ending.
Will Bitcoin Explode in Price After Tether’s Market Cap Adds $ 5 Billion in Supply?
Cryptocurrency investors are waiting for confirmation that the new Bitcoin bull market is here. An ongoing bullish retest is the closest thing to a confirmation so far, and if it holds up, the crypto market will gain some additional momentum.
However, another unexpected factor could help favor a bullish breakout and further advantage in the leading cryptocurrency by market capitalization. The parent company behind Tether just issued the biggest boost to the asset’s market cap and offering since the cryptocurrency traded below $ 4,000.
So a more than 100% increase in market cap appears to have skyrocketed Bitcoin. Before the bomb, taking Tether out of the market led to Bitcoin’s collapse to its bear market floor.
Clearly, there is a correlation between crypto asset pumping and dumping, and when Tether freely flows into the market.
Following the 2019 rally sparked by the Tether printer moving at full throttle, several much smaller supply increases throughout 2020 have had a similar impact. Every new, fresh stablecoin printing makes the Bitcoin bulls roar.
But the latest boost to Tether’s market capitalization is the biggest since the 2019 rally, which sent Bitcoin skyrocketing from $ 3,200 to $ 13,800. Could the next be another similar rally?
Why does the supply of Stablecoin seem to influence crypto asset valuations?
Price charts never lie, and there is a definite correlation between the supply of Tether and the rise in the price of the main cryptoasset.
With each round of new USDT minted, the bulls gain confidence and drive prices higher. It is not very clear why this correlation exists, but previous claims of price manipulation have never been proven.
More Tether seems to suggest that Bitcoin is poised for new bear market highs, potentially knocking out targets at $ 14,000 where the last rejection took place or a bit more.
If an increase of more than 100% in the supply of Tether in the past led to a price increase of 300% and $ 10,000 average price of Bitcoin, an increase of more than 40% from current levels could lead to Bitcoin more $ 14,000 and establish a new market on the upside.
A higher high in the weekly and monthly time frames could be a significant signal to the bulls that the bull market is starting, and could provide the necessary momentum to retest $ 20,000.
Tether’s market supply momentum also comes just as the asset hits 144 weeks from its all-time high, and is halfway through the old bear market downtrend resistance test as support.
Disclaimer: This press release is for informational purposes information does not constitute investment advice or an offer to invest. The views expressed in this article are those of the author and do not necessarily represent the views of infocoin, and should not be attributed to, Infocoin.