Bitcoin price hits 10-week low amid warning of ‘painful’ US Dollar recovery

Bitcoin price hits 10-week low amid warning of 'painful' US Dollar recovery

Bitcoin (BTC) staged a long-awaited breakout on September 7, when BTC’s price action broke the bulls’ eye on a rally.

1-hour candlestick chart of the BTC/USD pair (Bitstamp). Source: Trade View

A bounce from $23,000 ‘is still likely’, says the trader

Data from Cointelegraph Markets Pro and TradingView drew rapid losses for the BTC/USD pair later in the day on September 6, with an overnight low at $18,540 on Bitstamp.

The pair hit its lowest levels since June 30, taking liquidity off the July low and only slightly recovering on the day.

BTC/USD 1 day candle chart (Bitstamp). Source: Trade View

The downward price action was followed by almost a week of sideways movements. The volatility wasn’t there either, market participants had no choice but to exit while waiting for an upside recovery.

As it turned out, they remained disappointed, although there was still reason for popular trader Il Capo of Crypto to believe that a bounce of relief was on the way.

“First of all, the price is above the major daily support (low of the range, 18,500-19,000),” he said. declared on Twitter.

“This is where the latest bear market rally started, indicating strong demand here. A bounce from here to the supply zone (22500-23000) would be a perfect S&S. »

Il Capo of Crypto added that each breakout was accompanied by a decrease in volume, suggesting that sellers need to work more and more against the grain to drive prices down.

“The financing also shows that the shorts are getting caught on every drop leg, and there is enough fuel for a short squeeze,” he said.

For that to not happen, consolidation would have to start below the late June levels near $18,500.

“In short: it’s likely that there will still be between 22,500-23,000,” he concludes.

“Most people are arrogant and arrogant, but the charts show otherwise. Don’t trust your short posts. I’m still mostly on USDT but I’m hedging for this potential move. Time will tell us. »

Binance order book details for the BTC/USD pair downloaded by means of on-chain monitoring Material Indicators have confirmed that bitcoin is operating in a large liquidity zone.

Binance order book chart. Source: Content Indicators/Twitter

DXY gets 120 target after ‘major correction’

Macroeconomic markets continued to be interesting throughout the day, as the US dollar rallied.

The US Dollar Index (DXY) reached new 20-year highs at 110.78, along with deeper falls in the Euro and Yen, continuing a gloomy trend in recent months.

Also read: Bitcoin price falls below $19,000 as data shows pro traders avoided leverage ships

Daily candle chart of the US Dollar Index (DXY). Source: Trade View

For the macroeconomist Henrik Zeberg, a briefing should not be welcomed, as the greenback would then come back into effect and head towards 120, a level last reached in January 2002.

However, he predicted that the correction would mean that the cryptocurrency would take off

It’s all about #DXY. An early reversal for a big – fast – correction before the bottom and another painful rally to my ultimate target of ~120. The correction will last a few months and send risky assets #stocks #cryptocurrency etc soaring. = BLOW-OFF-TOP — Henrik Zeberg (@HenrikZeberg) September 7, 2022.

In contrast, WTI Crude Oil hit a year-to-date low in popular trading account Blockchain Backers. called the beginning of “the oil capitalization. »

US stocks opened slightly higher, with the S&P 500 and Nasdaq Composite Index gaining 0.3% and 0.65% respectively in the first hour of trading.

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