2021-5-12 15:31 |
The USD index had a hell of a good time during the first quarter of 2020 when it surged to 103 level in March while the rest of the assets from gold, stocks, oil, to crypto everything tanked.
In fact, USD has been enjoying an uptrend since early 2018, which interestingly coincides with the bear market of Bitcoin and all the other cryptocurrencies.
The greenback topped in March after the central banks around the world announced their ultra-loose monetary policy and started printing money like crazy. While USD started its downtrend from here, all the other asset classes began to appreciate in value, starting a mania that now has everyone calling it a bubble.
The USD Index started 2021 on a good note, soaring from its multi-year low of about 89 to almost 93.5 on March 29. Since then, it has been back in a downtrend, hitting 89.9 on Tuesday, a level that was last seen in late February.
And this is a good thing for the world’s largest cryptocurrency, Bitcoin, which has been relatively quiet after a big Q1 that took us from about $28k to $60k, as the market shifts its entire attention to Ethereum and the meme coins.
Bitcoin’s run-up in 2020 and early 2021 has been fueled by the changing macroeconomic conditions that brought in a new wave of institutional investors.
Source: CoinMetrics
With investors expecting the monetary easing to continue for longer than previously thought and inflation evident in the rising prices of food, lumber, iron, and other commodities, the dollar can be expected to weaken further, which has been historically good news for BTC, at least in the short term.
And while the price of Bitcoin continues to chop, trading in a range ever since February, it will give a healthier foundation for its next leg up. The fundamentals are strong as well, with hash rate, a proxy for network security, back to new all-time highs within a month of its big drop.
And although retail is focused on ETH, DOGE, and other small-cap crypto assets, Bitcoin adoption has still been growing with the number of addresses holding small amounts, between 0.01 and 1 BTC increasing by 710k since the start of the year seeing a big surge in April, as per CoinMetrics.
ETH 2.68%
Ethereum / USD
ETHUSD
$ 4,140.35
$110.96
2.68%
Volume 60.4 b
Change $110.96
Open $4,140.35
Circulating 115.85 m
Market Cap 479.64 b
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DOGE -8.36%
Dogecoin / USD
DOGEUSD
$ 0.46
-$0.04
-8.36%
Volume 7.41 b
Change -$0.04
Open $0.46
Circulating 129.57 b
Market Cap 59.7 b
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Technically, activation for Taproot has officially begun, while Lightning Network capacity is also hitting new highs.
Not to mention things can change quickly in the Bitcoin market, and “a significant corporate treasury allocation could force a rotation, and that’s a move that would be risky to fade,” wrote traders CryptoCred and DonAlt in their weekly note TechnicalRoundup.
Bitcoin/USD BTCUSD 54,972.5582 -$1,319.34 -2.40% Volume 65.98 b Change -$1,319.34 Open$54,972.5582 Circulating 18.71 m Market Cap 1.03 t baseUrl = "https://widgets.cryptocompare.com/"; var scripts = document.getElementsByTagName("script"); var embedder = scripts[scripts.length - 1]; var cccTheme = {"Chart": {"fillColor": "rgba(248,155,35,0.2)", "borderColor": "#F89B23"}}; (function () { var appName = encodeURIComponent(window.location.hostname); if (appName == "") { appName = "local"; } var s = document.createElement("script"); s.type = "text/javascript"; s.async = true; var theUrl = baseUrl + 'serve/v1/coin/chart?fsym=BTC&tsym=USD'; s.src = theUrl + (theUrl.indexOf("?") >= 0 ? "&" : "?") + "app=" + appName; embedder.parentNode.appendChild(s); })(); var single_widget_subscription = single_widget_subscription || []; single_widget_subscription.push("5~CCCAGG~BTC~USD"); The post USD Index is Crashing; It Has Been Historically Bullish for Bitcoin first appeared on BitcoinExchangeGuide.Similar to Notcoin - Blum - Airdrops In 2024
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