Crypto markets started the opposite of last week. Negativity continues in the stock markets. Today, with the negative opening of the US markets, the BTC price finds buyers below $26,500. So what does the current outlook indicate, will the prices recover?
Dollar Index (DXY) is Rising
Since March 8, the dollar index (DXY) has reached a level of 105.86 for the first time. This rise, which shows the increasing strength of the dollar against other currencies, is fueled by Fed policies. Powell said after the last meeting that tightening will continue until it reaches the necessary point, but the balance point is approaching.
The delay in the relaxation of the dollar due to the optimism in inflation caused by the $100 target for oil further strengthened the dollar. If the dollar index targets the previous peak of 115, it could mean more losses for cryptocurrencies.
Bitcoin and Cryptocurrencies
A breakout from the decreasing resistance line on the daily chart of Bitcoin is necessary to confirm the upward trend. However, the price should not see a weekly close below $24,800. This region has been intermittently acting as both resistance and support since July 2022, so it is of critical importance.
The upper wick reaching the local peak of $27,486 in the BTC chart indicates that sellers are still dominant in the market. If the negative trend continues, we may see losses deepening to $24,800 and then $23,500.
On the other hand, the bullish divergence in RSI, which started in July 2022, indicates the potential for the trend to rise again. Since the first bullish divergence catalyzed the current upward movement, if the trend line is not broken, the expectation of an increase may continue. In this scenario, the resistance area at $31,000 should be tested.
Many experts, such as QCP Analysts, published charts last week indicating that the price could fall into the $23,000 range unless there are strong closings above $28,000. There are 5 days left for the monthly closing for September, and the fact that the $26,000 level can be maintained is relatively positive.
Bitcoin is finding buyers at $26,141 at the time of writing. The dollar index and the price of oil are strong in favor of crypto. The cumulative volume has dropped to a low level of $14 billion, a decrease of 30%.
