BTC price rejects at $23K as US dollar declines from fresh 20-year highs

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Bit­coin (BTC) ran out of steam near $23,000 on June 16 after the biggest Unit­ed States key rate hike in near­ly thir­ty years.

BTC/USD 1‑hour can­dle chart (Bit­stamp). Source: TradingView

Dollar strength wobbles after rate hike news

Data from Coin­tele­graph Mar­kets Pro and Trad­ingView showed BTC/USD reach­ing highs of $22,957 on Bit­stamp after the Fed­er­al Reserve con­firmed a 0.75% hike in June — its largest since 1994.

Momen­tum did not last long, how­ev­er, and at the time of writ­ing, the pair had shed $2,000 to return to $21,000 at the new Wall Street open.

Pop­u­lar trad­er Cryp­to Tony eyed the U.S. dol­lar on the back of the Fed’s deci­sion, with an about-turn in USD strength key to a pos­si­ble Bit­coin bottom.

The U.S. dol­lar index (DXY), after spik­ing to twen­ty-year highs again after the announce­ment, began retrac­ing through June 16.

“Com­ing up to a big resis­tance zone on the dol­lar, which if we can reject from here and dump. The Bit­coin bot­tom may be in soon,” he told Twit­ter followers. 

“How­ev­er, I am look­ing for anoth­er tap up before the drop, which coin­cides with anoth­er leg down on $BTC so keep an eye on this.”

U.S. dol­lar index (DXY) 1‑day can­dle chart. Source: TradingView

Vet­er­an trad­er Peter Brandt, well known for his Bit­coin bot­tom calls, mean­while said that a retest of $20,000 would spark not a gen­uine recov­ery but a “relief rally.”

“Basi­cal­ly, the bear mar­ket is nowhere close to over for cryp­to. Was hop­ing for a nice ral­ly here but the mar­ket may need some more time,” com­men­ta­tor Josh Rager added in part of a tweet. 

EU, Japan cracks show

As U.S. equi­ties opened down after rebound­ing on the Fed news, con­cerns around oth­er world economies were just as fresh in the minds of many traders.

Relat­ed: These 3 met­rics sug­gest the Bit­coin price crash is not over

The Euro­pean Union was deal­ing with a blowout in Ital­ian bonds, while in Japan, cur­ren­cy weak­ness in the yen was becom­ing increas­ing­ly unnerving.

Due to a com­bi­na­tion of a strong dol­lar and ongo­ing quan­ti­ta­tive eas­ing — not tight­en­ing — USD/JPY hit its high­est since the late 1990s this week.

Both economies’ strug­gles were cov­ered by Arthur Hayes, for­mer CEO of deriv­a­tives plat­form Bit­MEX, in blog posts on Bit­coin’s future in recent months. 

For Hayes, the macro tur­moil, which would ulti­mate­ly cement Bit­coin’s sta­tus, was already play­ing out but the pain would pre­cede any form of relief for the largest cryp­tocur­ren­cy and its investors.

USD/JPY 1‑month can­dle chart. Source: TradingView

The views and opin­ions expressed here are sole­ly those of the author and do not nec­es­sar­i­ly reflect the views of Cointelegraph.com. Every invest­ment and trad­ing move involves risk, you should con­duct your own research when mak­ing a decision. 



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