BITCOIN Don't expect any rebound as long as the USD is rising!

25 Sep 2023

Bitcoin (BTCUSD) failed again to break above the 1W MA200 (orange trend-line), closing instead the 1W candle in red and is pulling back. Today's study is on the 1W time-frame and compares BTC's price action through the whole year to the U.S. Dollar's (DXY).

You would expect a correlation between the two but as you can see on these charts, it has gotten increasingly tighter lately. BTC's last two medium-term declines are the direct consequence of DXY's price increases. When DXY bottomed and started to rise, BTC topped and started to decline (vice verse DXY topping, BTC bottoming). Obviously a far riskier asset like Bitcoin is trading in a more aggressive pattern like a Channel Up while the more stable by nature currency is trading/ consolidating within a Megaphone.

DXY the approaching the top of that Megaphone pattern, in fact it is very close to the 105.900 High of March. Having broken above its 1W MA50 (blue trend-line) this month, while BTC is still supported on its own, we can't be realistically expecting Bitcoin to rebound as long as the DXY continues to rise, unless an outside catalyst such as very favorable (adoption) news hit the market. Until then Bitcoin should seek a Support confirmation on its 1W MA50, while DXY should start forming a top in October.

But what do you think? Will Bitcoin rise irrelevant of what DXY will do, or we need to see a top on the latter first? Feel free to let us know in the comments section below!

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