The dollar index (DXY) has managed to find support at an important level in the chart. That makes it unlikely that Bitcoin will be able to convert the resistance around $17,250 into a support point. The DXY also measures the performance of the US dollar against a basket of fiat currencies.
19.6 percent in 2022
In the year 2022, the DXY is already up 19.6 percent against its competition. Then it started a correction. The peak was at 114.60 and the DXY is currently hovering around 105.50 points. The fact that Bitcoin and the US dollar often move in the opposite direction became painfully clear from Thecryer’s chart yesterday.
You can see in the chart how the DXY jumps from 104.40 to 105.50 and Bitcoin immediately plummets down by $230. It seems that the dollar’s short period of weakness is over and that the US currency will regain ground against other fiat currencies. This would also mean a difficult period for Bitcoin and the stock market.
On-chain also bearish
It doesn’t look good for Bitcoin on the blockchain either. The miners in particular are having a hard time at the moment, which could just mean that they are going into capitulation mode. We speak of capitulation when they have to sell Bitcoin in large waves at the same time to keep their heads above water. The problem is that they only do this when the price is already at a low point.