Bitcoin Breaches Psychological Level of $30K amid Dollar Index Slipping
After printing nine consecutive weekly red candles, a scenario not seen in its 13-year journey, Bitcoin (BTC) is back to winning ways after topping the psychological price of $30,000.
The leading cryptocurrency was up by 5.42% in the last 24 hours to hit $30,648 during intraday trading, according to CoinMarketCap.
This price increase is experienced amid the falling US Dollar Index (DXY). Market analyst Lark Davis pointed out:
“The Dollar Index DXY is falling. Historically this is good for Bitcoin in the opposite way that Dollar rallies are bad for BTC price.”
With market analysis showing an inverse relationship between the DXY and Bitcoin, it remains to be seen whether this will trigger the much-needed momentum in the BTC market for a further price surge.
For instance, as Bitcoin soared by more than 295% in 2020, the DXY hit a 32-month low.
Bitcoin’s daily Bollinger Bands tighten
On-chain analyst Matthew Hyland believes the Bitcoin market might be experiencing the calm before the storm because the daily Bollinger Bands (BB) have squeezed to levels not seen in a year. He explained:
“Bitcoin daily Bollinger Bands are the tightest they have been in the past year. The Bollinger Bands Width (BBW) displays this. Buckle up, everyone.”
Bollinger Bands are a popular technical indicator developed by John Bollinger, which shows a market’s volatility. They are also used to indicate overbought and oversold conditions in the market.
With Bitcoin currently experiencing its 4th longest downtrend in its entire history, Hyland believes a reversal is imminent.
A crypto analyst under the pseudonym PlanB recently echoed similar sentiments, given that the moving average (RPMA) and relative strength index (RSI) indicators were at extremely low levels.
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