Bitcoin returned to the $24,056 area, which was considered a resistance level at the beginning of the month as U.S. stocks rose on the back of a softening situation with Taiwan.
BTC/USD 1-hour candle chart (Bitstamp) Source: TradingView
Stocks were up nicely this morning with the S&P up 1.2% and the Nasdaq Composite up 2% after the open. Everyone breathed a sigh of relief that the visit to Taiwan by the Speaker of the U.S. House of Representatives would have no repercussions from China.
The Dollar Index (DXY) strengthened after rising earlier in the week and closed at 106.36. The intraday lows coincide with the highs of May and there is still potential for new 20-year highs, which could affect cryptocurrencies.
U.S. dollar index (DXY) 1-hour candle chart. Source: TradingView
As before, it all depends on macroeconomic triggers “Given the positive correlation between bitcoins and U.S. stocks after COVID, the United States, which is the leading driver of bitcoin prices, suggests a risky market environment,” according to experts at investment firm ARK Invest. They also identified an unlikely but possible bitcoin level of just under $14,000.
ARK reports in its latest research “The Bitcoin Monthly”: “Similar to the sell-off at the peak of the COVID crisis, the bitcoin price has not reached the delta value base – the price-adjusted value base, which subtracts the moving average of the market price over time from the market value base and serves as the strongest level of bitcoin support.”
However, experts note : “While the likelihood of it touching its delta value is diminishing, the risk of bitcoin falling in a bear market technically remains at its delta value, which currently stands at $13,890.”
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