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The US Dollar Index (DXY), is a measure of the value of the US dollar. experiencing Bitcoin (BTC) is expected to rally as a result of one of its biggest weekly losses since 2013. Last time DXY experienced such a dramatic pullback, it was at the peak of the FTX crisis in November 2022. This coincided with a Bitcoin low.
Bitcoin: Will it see a rise?
BTC has dropped nearly 10% in the last two weeks. This is mainly due to the Fed’s hawkish position and the US tariffs against Canada, Mexico and China.
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The DXY is down more than 3 percent since March 3. It has fallen from 107 at the moment of this writing to 103. Cryptocurrency investors are hopeful that this decline will lead to a rally. This is supported by historical data.
In addition to the $15,000 BTC bottom formed in November 2022, the DXY has experienced similar sharp declines on two other occasions – during the COVID crash in March 2020 and back in the 2015 bear market when the premier cryptocurrency traded at $250.
The digital asset’s bullish momentum was regained on all three occasions that the DXY had dropped by more than four standard deviations. Merlijn The Trader, a crypto analyst shared his thoughts about the DXY and BTC relationship.
An analyst wrote in a post that BTC always rallies whenever DXY moving average convergence divergence has turned down. This was illustrated by the chart below.
Rekt Capital, another crypto analyst shared the same view. Analyst emphasized BTC is likely to have formed a new low following another downward deviation that saw the crypto currency hit A low of $78,258 was reached on the 28th February.
It is Important to Clear the $90,000.
Daan Crypto Trader is another crypto trader who hinted at the possibility that BTC could target new highs around $120,000 if BTC continues to consolidate close to range lows. The trader said:
This has happened in every cycle of consolidation. It breaks down, doesn’t continue, then retakes range and starts moving higher. We’ll see what happens. This $90K mark remains critical.
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The following are some examples of the use of analysis CryptoQuant’s analysis supports the idea that BTC has already reached a bottom. Ali Martinez is a seasoned cryptocurrency analyst. highlighted BTC is at oversold levels that have not been seen since August 20, 2024. This could indicate a short-term trend change.
BTC, however, is not the only cryptocurrency. facing A bearish deviation is possible as the CME fills a gap that was created by its new Chicago Mercantile Exchange. This could dampen expectations for a quick price recovery. BTC was trading at $86,870 as of press time. This is a 3.3% drop in 24 hours.
Charts from Tradingview.com and X, with the featured image by Unsplash
“This article is not financial advice.”
“Always do your own research before making any type of investment.”
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Source: www.newsbtc.com
