Bitcoin Slides 15% Post Record High, Faces Further Decline Amid Rising Tether Dominance

Bitcoin (BTC) has experienced a 15% drop just a week after reaching its record high of approximately $108,365, according to data from Bitstamp. Analysts warn the cryptocurrency may face additional downward pressure in the coming weeks, fueled by a sharp rebound in Tether's (USDT) market dominance.

Tether Dominance Signals Potential Bitcoin Dump

Highlights Bitcoin’s negative correlation with the USDT Dominance Index (USDT.D), which measures Tether's share in the overall cryptocurrency market. A notable rebound in USDT.D suggests traders may be seeking safety in Tether, anticipating increased market volatility or bearish momentum for Bitcoin.

USDT.D recently rebounded from support levels last seen in March when Bitcoin peaked locally around $73,800. The analyst predicts a similar scenario unfolding, with traders advised to approach any short-term Bitcoin price gains cautiously.

“We might see a sharp price spike — the classic pump — which could trick traders into thinking the market is rallying,” they said. “But this is likely a trap. Following the pump, a massive dump could wipe out early buyers.”

Recovery or Institutional Trap?

Bitcoin staged a modest recovery from its December low of $92,120, climbing to nearly $96,740 by Dec. 27. However, warns this uptick may be an “institutional ambush,” where dark pools and whales manipulate prices upward to lure retail traders before selling off at local highs, leaving smaller investors at a loss.

Key Levels to Watch: Bitcoin Bears Eye $81,500

Bitcoin's recent correction comes after failing to break the critical 1.618 Fibonacci extension level near $102,734. The weekly relative strength index (RSI) indicates overbought conditions and bearish divergence, signaling waning bullish momentum.

Currently trading near $96,000, Bitcoin's immediate downside target could be the 20-week exponential moving average (EMA) at $81,500. A steeper decline might push the price toward the 50-week EMA near $67,700, aligning with the 1.0 Fibonacci retracement level.

On the upside, reclaiming the 1.618 Fib line as support could fuel a Bitcoin rally toward $150,000 by early 2025, a target projected by multiple analysts.

This analysis highlights potential market dynamics and risks for Bitcoin investors as the cryptocurrency navigates a volatile environment influenced by Tether dominance and institutional movements.

#BitwiseBitcoinETF #BTCXmasOrDip? #Crypto2025Trends #bitcoin $BTC