Key Points
- Bitcoin’s price has been under pressure, moving into a bear market after a 20% fall from its peak this year.
- Bitcoin and other altcoins have key catalysts that may drive their value up in the coming months.
Bitcoin’s value has experienced a downward trend over the past few months, sliding into a technical bear market following a 20% drop from its highest point this year.
Bitcoin, along with other alternative cryptocurrencies, have significant triggers that could potentially propel their prices upwards in the near future. Currently, Bitcoin is trading at $90,000, marking a 15% rise from its lowest price this month.
Factors Influencing Bitcoin’s Price
One of the key factors influencing Bitcoin’s price is the US bond yields, which have seen a decline from their peak levels this year. The ten-year benchmark yield, for instance, fell from 4.8% in January to 4.24%. The 30-year and five-year yields have also seen a downward trend in recent weeks.
This decrease in bond yields suggests that the market expects the Federal Reserve to implement additional interest rate cuts this year. This expectation arises from a series of weak US economic data, leading to a drop in consumer and business confidence, especially after President Donald Trump imposed tariffs on key US trading partners.
The US labor market has also seen a softening, with the unemployment rate climbing to 4.1% in February and nonfarm payrolls increasing by only 151,000, which is lower than the anticipated 159,000.
US Dollar Index and Bitcoin Price
Another factor influencing Bitcoin’s price is the US dollar index or the DXY, which has been in a freefall, dropping for five consecutive days to a low of $103.78, its lowest since November. This marks a nearly 7% decline from its peak this year.
Bitcoin often performs well when the US dollar and bond yields are slipping as it increases the likelihood of Fed interest rate cuts.
Furthermore, the global money supply is projected to continue rising as governments increase their spending. For instance, Germany plans to spend billions on defense, while China has announced plans to boost spending. Bitcoin’s price has a close correlation with the global M2 money supply.
Bitcoin Price Technical Analysis
The daily chart indicates that the BTC price has remained stable in recent days, increasing from a low of $78,000 last week to $90,000.
Bitcoin has stayed above the ascending trendline, which has linked the lowest swings since August of last year. It has also moved above the 50-day moving average and the weak, stop & reverse point of the Murrey Math Lines.
Therefore, for a bullish breakout to be confirmed, Bitcoin needs to surpass the strong, pivot, and reverse level at $93,750. This price aligns with the highest level this week. A rise above this level could indicate further gains, potentially reaching $100,000.
