Bitcoin price got here underneath intense strain this week as the VIX and the US dollar index (DXY) surged. It moved beneath the vital help stage at $20,000 and is buying and selling at $19,125. The BTC/USD and BTC/GBP have crashed by greater than 50% this 12 months.
US dollar index surges
The BTC price has been in a steep sell-off in the previous few weeks as the US dollar index has bounced again. According to Bloomberg, Bitcoin surged to $112.8, which was the highest stage in additional than 2 a long time. This occurred as the British pound dropped to the lowest stage since 1987 and is now approaching the parity stage.
The euro has dropped beneath parity and is at the lowest stage in additional than 20 years. Other currencies like the Swedish krona, Japanese yen, and the Swiss franc have additionally been in a steep downward pattern recently.
The US dollar index power continued after the Federal Reserve continued its hawkish tone this week. In its assembly, the financial institution determined to hike rates of interest by 0.75%, bringing the year-to-date enhance to 300 foundation factors. Notably, the officers warned that the financial institution will proceed delivering jumbo charge hikes later this 12 months.
The impression of the hawkish Fed grew to become seen to the market as Bitcoin price crashed beneath $20,000. American shares tumbled, with the Dow Jones, S&P 500, and Nasdaq 100 indices crashed by greater than 1.80% on Friday. Bitcoin has a detailed correlation with US shares.
At the similar time, bond yields continued hovering, with the 2-year yield rising to 4.2%, the highest stage in additional than a decade. 10-year and 30-year authorities yields rose to three.68% and three.61%, respectively.
Therefore, there’s a probability that the BTC price will proceed struggling in the coming days as the Fed maintains its hawkish tone.
Bitcoin price prediction
The every day chart exhibits that the BTC price has been in a powerful bearish pattern in the previous few months. It has moved beneath all shifting averages and crossed the vital help stage at $20,704, which was the lowest level on June 26. The Relative Strength Index (RSI) has moved barely beneath the impartial level.
Therefore, there’s a probability that Bitcoin price will proceed falling as sellers goal the subsequent key help stage at $18,000. A transfer above the resistance stage at $21,000 will invalidate the bearish view.
