FOMC Minutes Fueled DXY Index-Warning Bell For Bitcoin Price?
Crypto markets are consolidating following the Fed meeting, during which a 25 basis point increase was implemented to reduce inflation rates. The decision to raise interest rates from 4.5% to 4.75% was taken during the Federal Open Market Committee (FOMC), which was announced in a press conference by Fed Chair Jerome Powell. However, the US market’s response was moderate, but it did offer the Bitcoin price a slight push.
The BTC price increased following the FOMC meeting as markets reacted positively to the decision to raise interest rates by 25 basis points. While another test for the resistance at $25,000 was expected, the bears enhanced their strength to restrict the price below $24,500. Besides, the DXY Index, which showed some strength, is now more sluggish, indicating the possibility of a bullish reversal for the star crypto soon.
The Bitcoin price, after the recent upswing beyond $24,000, has been trading within a pre-determined price zone. Following the recent FOMC meeting, the price rose from lower support but is now facing some bearish challenges just above average levels. As the RSI falls, the price may continue to fall and reach the interim support level of $24,245 before encountering a decisive phase.
If the Bitcoin price rebounds after gaining enough bullish momentum, then a notable rise may be expected towards the highs beyond $25,000. A rejection at the crucial support level may also drag the price lower to test the bottom at around $23,500. Therefore, the next few hours could be extremely crucial for the Bitcoin (BTC) price.
Here’s How The DXY Index Could Impact The Crypto Space
On Friday, i.e., November 4th, the US Department of Labor released the unemployment data, indicating an increase in the rate, which hit 3.7% for October. After the data was released, the US stock market and the crypto market heaved a sigh of relief as this could mean that the FED would not continue increasing the interest rates from here on out.
However, increased unemployment is definitely a bearish sign for the US Dollar Index (DXY), but what does this mean for the crypto space?
DXY and Crypto
Well-known crypto analyst Justin Bennett has the answer.
He informs 110,500 Twitter followers that the increase in US unemployment rates is a bearish sign for the DXY but is highly bullish for Crypto.
Next, the analyst considers the present chart and claims that the hourly DXY chart indicates a fakeout. Also, he says he is still holding on to his prediction of 111.80 for DXY, which will bring in a bearish trend.
Justin Bennett further claims that the DXY value will affect the top cryptocurrencies like Bitcoin and Ethereum, and he claims 109.30 to be the critical level for DXY. This is because in the next week, if DXY closes below the said range, Crypto will see a bull run, and if DXY moves above 109.30, the crypto market will witness immense bearish pressure.
Dogecoin: What lies ahead?
The analyst also talks about the asset of the month- Dogecoin.
He says that if DOGE reclaims $0.13000, the currency will see new heights.
Now, as Dogecoin has claimed the $0.13000 area and is trading at $0.1309 after a rise of 6.29% in the last 24hrs, it appears that DOGE will see some new heights soon.
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DXY Index Reaching New Highs, Crypto Markets Could be in Distress This Weekend
The crypto space is expected to be in dire straits as the top crypto, Bitcoin is currently switching above and below $19,000. The shaky environment could be due to the strengthening of the USD as the DXY index is surging high and marking a new 20-year high. Presently, the index has jumped above $113, making a new yearly ATH.
In the times when DXY Index is marking new highs, the crypto space has been impacted negatively. On the brighter side, the index is closer to dropping significantly close to $112 or below, but may soon rise above $114.
As per the above chart, the DXY index is assumed to drop as it did before in 2015-16. Here the DXY underwent a parabolic recovery from wave 1 to 3 after rebounding from wave 2. Further, the rally dropped to hit the 4 and later rebounded to wave 5. A similar trend is expected to repeat in recent times and may drop to $112 and later rise back beyond $114.
Therefore, a minor bounce may be expected with Bitcoin & entire crypto space. But as the index rises, the crypto markets may fall apart. Presently, the BTC price is again dropping back towards the demand zone between $18,277 and $18,928. If the asset fails to rebound from these levels, the price may witness a huge bearish trend in the coming days.
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Crypto Markets Remain Unsettled, Bitcoin & DXY May Reverse their Stance Soon!
Bitcoin price is displaying acute strength despite the crypto markets including Ethereum price tumbling down. The growing strength within the star crypto may be an outcome of the US dollar becoming fragile. Ahead of the crucial CPI announcement, the DXY Index is plunging hard to reach the levels below $108 that have induced a significant momentum within the BTC price.
However, the conditions are expected to flip shortly as both the assets, Bitcoin & DXY Index appear to have stuck up in a trap!
On the other hand, the Ethereum platform is all set to undergo a Merger in less than 36 hours but the markets continue to remain uncertain. It appears that the impact of the event has faded over time. Nevertheless, the BTC price is believed to be at the peak of the bull trap and a significant drop may make its way out soon.
A popular analyst Bloodgood believes that the BTC price is primed to hit the lower support at $20,000 while the ETH price may fall prey to a “buy the rumor, sell on news”.
Conversely, the DXY Index seems to be preparing for the next leg up which may break the previous highs at around $110.78 and reach $112 in the next 24 to 48 hours. Hence flashing significant bearish signals for the BTC price at the same time.
Collectively, Bitcoin & DXY Index has been displaying a huge correlation, inversely, of-let. While the CPI figures are expected to drop slightly from the recent figures at 8.5% to 8.1%, the USD may gain notable strength ahead, challenging the BTC price & the entire crypto space.
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Bitcoin Price Crashed Below $19K, DXY Climbs Above $110, This Should be a Wake-Up Call for Bulls!
Bitcoin price remained passive while the market sentiments lept on coiling ahead of the Bellatrix upgrade. Interestingly, as soon as the upgrade went live, BTC prices along with the major altcoins & ETH prices dropped heavily. Presently, Bitcoin is finding it extremely difficult to regain levels above $19000 as the strengthening DXY Index is causing a major hurdle.
Therefore, the Bitcoin Bulls have to wake up and hold the BTC price, or else a new yearly appears imminent!
The BTC price which is currently $50,000 below the November highs, appears to slash another 15% in the coming days, as the US Dollar is gaining immense strength. The DXY Index has climbed above $100 and despite immense bearish pressure, displays the possibility to form new highs every new day.
As seen in the above chart, the DXY Index marked a 20-year high and is poised to continue surging ahead. Presently, the price is testing one of the pivotal resistance zones between $110 and $111.5. If the index clears these levels successfully, it may be a huge nightmare for Bitcoin price & entire crypto space.
Bitcoin (BTC) Price Yet to Reach the Bottoms
A popular analyst, il Capo of Crypto who constantly warned about the upcoming bearish trend of BTC price while the asset traded above $22,500, has now set the bottoms for the asset at around $16,000. As per the analyst, the price is mirroring a previous action which may drag the price close to or below $16,000.
However, the downfall appears to be a trap and if the price closes the day’s trade in between $18,900 or $19,000, then it may be a decent start to a rebound ahead. Further, the rebound could be validated once the Bitcoin(BTC) price reclaims the $19,500 level. Until then, the asset may remain within the bearish captivity, flashing the possibility to form new bottoms soon.
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Bitcoin Long Trades Pile Up While Surging DXY Index Haunts the BTC Price Rally – Coinpedia – Fintech & Cryptocurreny News Media
The dominant crypto, Bitcoin has been trading within bearish captivity for nearly 15 to 20 days and hence was expected to break the trend very soon. In the past couple of days, the price has been trying to surge above the immediate resistance. However, the current trade set-up denotes that the bulls have stepped out as the bears mark their strong presence.
Investors Bullish on Bitcoin
While the upcoming trend of the BTC price has become pretty unpredictable, more traders are confident of the asset pulling a significant leg up. Hence the volume of long trades has recently outperformed the short trades on Binance futures.
The data above displays the volume of the long trades & short trades in the past week. Despite the shaky price trend, the investors placed their bets on Bitcoin long more than shorts. As of September 01, nearly 67.59% of trades on Futures are long while 32.41% are short. Therefore, the possibility of the BTC price surging above $21,000 emerges, which may be followed by a notable drop.
Strengthening of DXY Index – A Bearish Case for Bitcoin
Conversely, the DXY Index, which determines the strength of the US Dollar is coiling up. After a minor rejection from 20-year high levels at 109.99, the asset failed to continue to remain within bearish captivity. Hence the Index, since the early trading hours has been extremely bullish, flashing the signals of marking new highs very soon.
The DXY Index is expected to surge slowly yet steadily and may retest the upper resistance in the coming weekend. Further, it may again experience a rejection, which could be reversed in a very short time ahead. In such a case, the Bitcoin price may experience tougher times as the possibility of a significant dump may be imminent.
Considering both cases, it is quite prominent that the descending consolidation of the asset is expected to prevail for some more time. As September month is largely believed to be bearish, the Bitcoin(BTC) price may maintain a low-key trend for a long.