Bitcoin (BTC) maintained its gains above $21,000 on November 5 as the US Dollar experienced a major daily decline.
Dollar falls 2% as risky assets rally
Data from Cointelegraph Markets Pro and TradingView showed that the BTC/USD pair built on earlier strength to reach highs of $21,473 on Bitstamp – a new seven-week high.
The pair benefited from the latest US economic data, while the dollar, on the contrary, suffered. The US dollar index (DXY) lost 2% in one day for the first time in years, helping to fuel a rally in risk assets.
“And, just like that, bitcoin has hit all the highs, the volume is picking up, and it’s back above $21,000,” said said Michaël van de Poppe, CEO and founder of the trading company Eight.
“I think we will continue towards $22,500 from here, but have a small correction before we continue (because we have taken all the liquidity). Buy dip season. »
BTC was previously known for its lack of volatility and narrow trading range, which helped it beat even first-time stocks.
“For the first time in history, bitcoin is less volatile than the S&P 500 and the Nasdaq,” said Note Yassine Elmandjra, cryptocurrency analyst at ARK Invest, referring to the company’s latest report, “The Bitcoin Monthly”.
“The last time volatility was this low, bitcoin went from $9,000 to $60,000 in less than a year.”
Meanwhile, Tyler Winklevoss, co-founder of the Gemini trading platform, expressed his belief that cryptocurrencies will continue to act as a key indicator of the overall trajectory of the market, like in 2021.
“Cryptocurrency was the first asset class to be predicted; she will be the first to rise,” he said. abstract.
Bitcoin more stable than major fiat currencies
Continuing the theme of low volatility, the ARK report, led by renowned analyst David Puell, showed that stocks were not the only ones suffering from bitcoin’s stability.
Also read: Why is the cryptocurrency market up today?
“Bitcoin’s relative volatility has decreased not only against stocks, but also against major currency pairs. As macroeconomic uncertainty and USD strength increased, foreign currency pairs were negatively impacted, while bitcoin remained relatively stable,” said The Bitcoin Monthly.
“Bitcoin’s 30-day realized volatility is almost identical to the British Pound and the Euro for the first time since October 2016.” While the Fed’s hawkish stance may continue to fluctuate, bitcoin’s strength against foreign currencies is an encouraging sign. »
As Cointelegraph reports, another popular analyst, LookIntoBitcoin creator Philip Swift has predicted that the current bear market will end in early 2023.
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