Today bitcoin is down about 4% at just under $11,500 after sustained activity toward a $12,000 mark that had short-term traders looking at immediate futures markets.
Omkar Godbole at Coindesk covers some of the bearish indicators for Bitcoin and suggests that they might be tied to U.S. dollar activity where the dollar, he says, is “showing signs of life.” Godbole cites a rise in the dollar index which came up from 91.75 to 92.50.
“Immediate support (for BTC) is located at $11,170; a violation there would confirm a head-and-shoulders breakdown, a bearish technical pattern, on the 4-hour chart,” he writes.
Conversely, as Bitcoin rose over the past few weeks, experts were tying that to the dollar’s free fall and negative pressure on the world’s reserve currency.
“Bitcoin has developed a relatively strong negative correlation with the greenback over the past few weeks,” Godbole writes.
Now, analysts are contending that the positive move on the dollar index represents greater than expected manufacturing in the U.S.
That indicator is also putting pressure on gold, which is down about .1%, although some characterize that as routine profit-taking.
Where will Bitcoin go in the weeks to come? And does it track with changes to the dollar in U.S. equity markets, where we keep looking for the long-term effects of broad US/China trade tariffs, and uncertainty over pandemic closures?
If you’ve been reading along for the last few months, you probably already have an idea one way or the other. We’ve showed how some of these financial changes converge, and where Bitcoin acts relatively independently. Bitcoin analysis always has to do with various short-term and long-term factors which have to be taken into consideration. Write to us and tell us what you think about the future of Bitcoin, and where you see it in one or five or ten years.
