The US dollar regains lost ground while Bitcoin’s price is once again nearing record highs and now the momentum is in the bulls’ favor so let’s read more in our latest Bitcoin news today.
While this is nothing new for the cryptocurrency, the recent rally to the local resistances happened while the US dollar regains lost ground and strengthens. Bitcoin’s price is only $1000 away from reclaiming $60K and making an attempt to set a new record high with the cryptocurrency consolidating for weeks and build a base at which to surge higher.
Most of the uptrend was because of the BTC strength and the weakness in the dollar’s global reserve currency. As one-half of the dominant BTC pair, the free fall of the dollar that started with the pandemic became the most widely discussed topic in finance. The US alone added trillions of dollars in money supply due to the ongoing stimulus efforts which only weakened the buying power of the leading fiat currency and a narrative of 21 million BTC coins alongside the risks of growing inflation fears which propelled BTC and crypto into superstars.
Being bearish on the dollar has been a crowded trade and things were turning around. While this usually means that it will start flipping bearish in crypto as well, BTC fended off more corrections.
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The deviation in the inversely correlated DXY and BTCUSD charts is unusual as the DXY is a weighted basket of top national forex currencies that traded alongside USD and it is used as a barometer of health for the dollar. there’s been an obvious relationship between the charts but a few moments were pronounced as the Black Thursday selloff and bull run since.
The below chart showed how the two extreme moves in the DXY Dollar Currency Index started a new bear market in BTC but then a bull market in cryptos. The phrase “this time is different” is considered a very dangerous investment strategy but looking at the price actions, something is different this time. The DXY reversed and rose to the highest point since BTC surged in September. BTC is about to explode unlike ever before, at least by some analysts but some think that we can expect a serious correction.
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