Bitcoin slips back below 35,000

Bitcoin slips back below 35,000, US dollar gains strength in return

Due to a strong US dollar, Bitcoin is going downhill again for the time being, but experts still see great potential for this upward trend.

Bitcoin (BTC) slipped below US$35,000 today, 15 January, Immediate Edge as a resurgent US dollar put pressure on the market-leading cryptocurrency. The price managed to catch suppor  at US$34,300 and was at US$35,300 at press time.

As data from Cointelegraph Markets and TradingView shows, Bitcoin took a dive on Friday, only stopping at just under US$34,000.

The day before, the market-leading cryptocurrency initially managed to climb back to 40,000 US dollars, before falling back into a price range that had already formed at the beginning of the week. The current downturn suggests that bitcoin will continue to move in this broad range, roughly from US$30,000 to US$40,000.

„The current sideways movement of #Bitcoin is good for the market after the steep climb up to US$41,500,“ as Cointelegraph Markets analyst Michaël van de Poppe explains on Twitter. He adds:

„#Bitcoin is now running towards support after failing at US$40,000 resistance. Sideways movement ahead of new upward momentum is something positive.“

Uptrend still holds great potential

Bitcoin’s current downturn has been accompanied by a bounce for the US Dollar Index (DXY), which is favoured that the forthcoming US President Joe Biden has announced a 1.9 trillion. US dollar Corona bailout package. Although this threatens further inflation for the US dollar, the money market has reacted mostly positively to the news, sending the DXY higher. As bitcoin has an inverse correlation with the index, the market-leading cryptocurrency went down in return.

„Explanation: the US dollar can bounce upwards. A relatively strong rally at a multi-month support. Some see this as bad for bitcoin, gold and risky asset products,“ as summarised by Cointelegraph analyst Joseph Young.
Bitcoin (bitstamp) and US dollar index (orange) in comparison. Source: TradingView

Young also points out that derivatives traders are speculating on the downturn, which reduces the chances of a renewed upswing somewhat for the time being.

Nevertheless, things look good for Bitcoin in the long term, because as the crypto market researchers at Ecoinometrics have calculated, the current upward trend still holds great potential.