Interesting Bitcoin market activity at the beginning of this week shows that the household name cryptocurrency has the capacity to keep climbing.
After cresting $12,000, Bitcoin has sunk back to around $11,900 today.
Other indicators provide ballast for bullish sentiment on Bitcoin. Omkar Godbole at Coindesk, writing about current market activity, reports that Bitcoin’s “options market skewed bullish” and suggests that a new Ethereum blockchain ecosystem improvement could help boost Bitcoin as well.
“A break above $12,118 looks likely, as bullish demand can be seen in the strong hourly volume that continues to rise with Bitcoin’s hike in value,” Godbole writes. “If Bitcoin manages to surpass the $12,118 level, the next target would be the high of $12,325 reached early in August 2019.”
Another less sanguine prospect that traders are looking at involves the U.S. dollar, which seems to be trading at an inverse with Bitcoin over the last few months.
A dollar bounce, as Godbole notes, could have a negative impact on Bitcoin price, and as for dollar projections, Morgan Stanley is suggesting that the dollar is now extremely oversold.
“The overwhelming bearishness surrounding the dollar is unnerving Morgan Stanley strategists, who argue that the extreme positioning could see the greenback’s selloff slow down,” writes Sunny Oh at MarketWatch. “That could present a tougher backdrop for global equity markets that have rallied in sync with the greenback’s decline.”
Oh mentions the impact of coronavirus on the dollar, citing some market technicals.
“Led by the euro’s rally, the greenback has weakened since its peak of the market panic around the COVID-19 pandemic, when a rush to safety amplified a mad scramble for dollars,” Oh writes. “The ICE U.S. Dollar Index DXY, -0.11% is down nearly 3% this year, and is matching levels last seen more than 2 years ago. The index was in rebound mode on Friday, however, surging 0.8%.”
Look for more as the week develops.
