Bitcoin has been picking up lately and was set to go above $40; it has, however, not managed to. Despite Bitcoin bulls working hard at their task, there has been a rise in COVID-19 infections, which has negatively impacted the trading volumes. This has threatened Bitcoin’s recovery.
There has been an ongoing battle on Bitcoin’s performance in the cryptocurrency market on whether Bitcoin is set to go down or up. Bitcoins’ history performance indicates that it might lag in the current phase longer because the dollar is strengthening. This suggests that there is a decrease in economic stimulus due to technical factors affecting Bitcoin’s price.
A stronger dollar negatively affects crypto.
The US dollar has been strengthening lately, and that may affect the trend of crypto performance. Delphi Digital suggests the dollar is affecting risk assets everywhere. The dollar has affected the 10-year Treasury yield, which shows economic expansions experienced in the first quarter of the year are going down. This is partly affected by the rising cases of Covid-19 infections that threaten the economic recovery.
Is Bitcoin still bearish?
When we look at the short-term Bitcoin performance, it suggests that Bitcoin is still bearish. Analysts suggest that it may take up to a year for a full correction to be done. Delphi Digital data suggest that the currency 12-month moving average is acting as support, and when bitcoin goes below that, its price will go downhill. The 12-month moving average has always acted as Bitcoin’s support level, and thus the price-performance around this level determines bitcoin’s future performance.
Traders are now on the fence as low trading volumes lead to high volatility, which leads to price fluctuations. The bearish levels will increase when the price gets near $30,000. With the given market structure, there will be more short-term volatility, affecting the crypto space in general.