Soon the 100 – Bitcoin (BTC) is trading below $30,000. The signals, however, generally show a bitcoin ready to begin a bullish recovery.
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Bitcoin below $30,000: stocks on the rocks, the dollar a springboard?
bitcoin price falls up to around $28,690 today, May 24, 2022, before rallying above $29,000. Bitcoin is trading at $29,484 at the time of writing. It is currently recording a daily mini gain of 0.54%.
How can we explain the difficulty for bulls to regain control in the short term? Bitcoin remains below $30,000, as the S&P 500 and Nasdaq saw declines of 2.4% and 3.5% respectively at the open. For the twitter account IncomeSharks“ stocks once again control the price of Bitcoin “.
However, the cryptocurrency would resist “relatively well”. IncomeSharks pointed out that “most stocks have much larger daily declines than BTC.”
If the equity market is expected to exhibit a positive correlation – but not necessarily strong – with bitcoin, the US dollar (DXY) should in theory have a negative correlation with the price of the latter.
Trader Michaël van de Poppe indicated that the downward trend in the dollar “ continued and reached the next level of support, in which we rebound from 101.76”.
From this level, Michaël van de Poppe estimates that “we could have a continuation towards 102.69 points”. But losing the 101.76, “ we will go to 100 “. The value of DXY is currently 101.76.
But how low does the value of DXY need to drop for risky assets like bitcoin to start a real bullish rally? Should the dollar drop below 100a level it last touched on April 21, 2022, just over a month ago?
Does the technical analysis of the bitcoin price also allow – in the same way as this drop in the DXY – to predict a next bullish rebound? Trader Rekt Capital shared a weekly bitcoin price chart that would attempt to find support around $29,000.
Although there is “a major difference between now and the revisits of this zone in early and mid-2021”, Rekt Capital recalls that “in early/mid-2021, BTC touched low from the Range Low and rebounded strongly”.
In other words a drop below $29,000, was followed by strong increases in the price of bitcoin on a weekly basis.
Is Bitcoin really a day or two away from a bullish reversal? Or will it still continue to trade in the $29,000 – $31,000 range until the end of May 2022?
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