Bitcoin (BTC) is back in familiar territory as it starts the week after the weekend stretching across its new, albeit large, trade corridor, which is in excess of $ 30,000.
With only a few days left until the inauguration of the President of the United States, Cointelegraph will look into other matters that could destabilize the bitcoin price campaign.
DXY recovers losses
The inauguration of President-elect Joe Biden comes amid the continued recovery of the US dollar.
The US dollar index (DXY), which measures the US dollar against a basket of currencies of major trading partners, on Monday reached its highest level since December 21.
The continuation of DXY’s uptrend generally means that Bitcoin’s rally is taking a break, and this inverse relationship is an attractive pattern until 2020. In this case, BTC / USD didn’t have much to lose from its recent rally, much of which continued. Despite the huge volatility. …
DXY was also not affected by Biden’s decision to spend an additional $ 1.9 trillion on debt-funded coronavirus support, which Gemini co-founder Tyler Winklevos called “another billions of dollars bitcoin announcement last week.”
Nevertheless, as Cointelegraph reported, analysts continue to prioritize the dollar’s weakness for a long-term continuation. Even traditional market participants continued to monitor the size of the rally in the US dollar, which shocked many when they saw Bitcoin as an alternative store of value.
“The foreign exchange market is no different than any other market,” William Denning, investment director at Waverton Asset Management, UK fund manager, told the Wall Street Journal over the weekend.
If there is a lot of potatoes, it will be cheaper. If there are too many dollars, it will be weak. ”
However, future Treasury Secretary Janet Biden said the US would not deliberately seek to support dollar weakness in favor of trade gains.
The analyst says stocks need to rest
In the markets, stocks showed hesitation earlier in the week after calming down after Biden’s announcement.
Asia saw mixed performance, and with Wall Street continuing to open up to the press, US futures rose slightly since Friday.
Some were curious about the weak growth, despite the fact that China presented economic statistics for the fourth quarter that exceeded expectations. According to a Bloomberg report, the second-largest economy in the world grew 6.5% in the quarter, making it the only major economy to survive the coronavirus contraction last year.
“The markets needed a break or even a retreat to meet the expectations of the thinking,” Ben Emmons, chief executive of global macro strategy at Medley Global Advisors, told the publication.
According to the Cointelegraph report, Bitcoin will continue to outperform all traditional assets in terms of gains in 2021, with correlations close to zero for both stocks and safe havens such as precious metals.
Bitcoin revenue correlation for 90 days. Source: Data on digital assets.
In the spotlight “Altsezon”
In recent days, too, Bitcoin has taken hold of itself. After several weeks of extremely volatile trading conditions, investors were enjoying a quiet weekend, which also came as a surprise to the stock markets.
US platforms Coinbase and Kraken have previously experienced disruptions at critical price points, and the eToro trading platform warned last week that it may need to restrict bitcoin buy orders in the event of new volatility over the weekend.
In this case, things were quieter than expected, thanks to the remainder of the BTC / USD without any real bullish or bearish changes.
As analyst Mikael van de Poppe at Cointelegraph Markets notes, the focus is on altcoins rather than Bitcoin.
In his tweet on Monday, he repeated a story that other cryptocurrencies should be in the spotlight in the short to medium term. He summarized:
Most likely, the following will happen at this point. Promotion meetings are everywhere in the #altcoin markets. FOMO for Alternative Currencies. # Bitcoin fixes again -> Alternative currencies work on HL and test it again.
A sneak peek at the rankings confirmed the start of the so-called “alternative season”, when five of the 100 largest cryptocurrencies by market value posted a daily profit of over 20%. In terms of weekly performance, seven icons rose more than 100%.
Even ETH, the largest alternative currency, is near all-time highs, rising above $ 1,200 after the decline that led to the loss of $ 1,000 in support at some point.
However, Bitcoin’s market capitalization fell further on Monday, reaching 66.3%, up from 69.5% at the start of the year.