Summary of "🔵 Watch This Chart Before You Take Profits! Tether Dominance Bitcoin Top Signal"
Summary of Financial Strategies, Market Analyses, and Business Trends:
- Main Indicator Introduced: Colin presents a proprietary Tether Dominance Top and Sub Peak Indicator, an experimental yet historically reliable tool designed to signal Bitcoin cycle tops or sub peaks based on the dominance of USDT (Tether) in the market.
- How the Indicator Works:
- The indicator uses an inverted logarithmic regression chart of Tether dominance starting from around 2015.
- Peaks in Tether dominance (when the chart touches an upper curved regression line) correlate strongly with Bitcoin cycle tops or significant sub peaks.
- This pattern has held consistently for about 10 years, becoming more reliable in the last 5 years for marking major tops/sub peaks.
- Key Observations and Patterns:
- Every time Tether dominance breaks out of a certain white trend line, it tends to move toward the upper regression curve, signaling an upcoming Bitcoin top or sub peak.
- Historical examples include the 2017, 2021 cycle tops, and recent 2024 sub peaks in Bitcoin price, all coinciding with Tether dominance hitting this upper boundary.
- The next expected breakout and top is predicted around October 2025, potentially signaling Bitcoin prices between $140,000 and $150,000.
- Trading Strategy Based on Indicator:
- Colin plans to take profits or start dollar-cost averaging (DCA) out of positions when the Tether dominance indicator hits the upper parabola line, regardless of other metrics.
- This indicator is primarily a time-based signal for when to take profits, not a price prediction tool.
- Complementary metrics such as global M2 money supply, CBBI index (a composite macro indicator), PI cycle top indicator, social media sentiment, Coinbase app rank, and Google search trends are also considered to gauge market “overheatedness” or “underheatedness.”
- Market Sentiment and Altcoins:
- Current social media sentiment is low, suggesting the current price level (~$117K-$123K) is unlikely to be the final top.
- Colin expects sentiment to rise toward euphoric levels as the Tether dominance indicator approaches the top parabola, potentially marking the cycle peak or sub peak.
- Altcoin season is anticipated to occur later in the cycle once Bitcoin dominance starts to decline, signaling a rotation into altcoins. Quality altcoins are recommended for holding during this phase.
- Caveats and Disclaimers:
- The indicator is experimental and not guaranteed.
- Colin emphasizes that this is not financial advice and that market conditions can change unpredictably.
Step-by-Step Guide to Using the Tether Dominance Indicator:
- Track the inverted logarithmic Tether dominance chart and identify when dominance approaches or touches the upper regression parabola line.
- Observe if Tether dominance breaks out of the established white trend line indicating an impending move to the upper curve.
- Use this signal as a time-based cue to start taking profits or DCA out of Bitcoin positions, independent of Bitcoin price.
- Cross-reference with other macro and sentiment indicators (CBBI, PI cycle, social sentiment, app rankings, Google trends) to confirm market overheatedness and adjust profit-taking strategy accordingly.
- Monitor Bitcoin dominance for signs of decline to anticipate the start of Altcoin season and adjust altcoin holdings accordingly.
Presenter:
- Colin from Colin Talks Crypto
Category
Business and Finance
