After weeks of tranquillity, the world of digital money is getting up some steam. The bulls of the esteemed cryptocurrency, Bitcoin, are aiming for a comeback. However, the rise in the U.S. dollar index (DXY) might be an obstacle on the road to recovery. A report from Glassnode, led by on-chain analyst Checkmate, brought attention to the tight range Bitcoin has been confined to during August. Such low volatility periods typically precede a phase of range expansion. But pinpointing the exact time of breakout is notoriously difficult, leaving traders on their toes.
However, this containment within a tight range might be the result of the recent strength of the U.S. dollar index (DXY), which experienced growth for four weeks consecutively. The upward trend in the DXY has likely influenced the risky assets negatively, as the last few days have seen a corrective phase hit the United States equities markets.
Shifting our gaze towards the S&P 500 Index (SPX), we observe that the asset slipped below the 20-day exponential moving average on August 3, followed by a healthy recovery on August 14 off the 50-day simple moving average. The contours of this behaviour suggest the bulls are in control and are poised to generate further momentum.
On the other side, one can’t ignore that the bears shield the 20-day EMA fiercely, and, if they manage to push the price below the 50-day SMA, they could provoke a deeper correction.
Bitcoin recently slipped under the 20-day EMA but quickly regained its footing. It appears the bears’ selling aggression at lower levels dwindled, leading to a balance between the buyers and the sellers and a possible continued consolidation inside a specific range.
The trends in the Ethereum market, however, somewhat favour the bears. The 20-day EMA flattened and the RSI hit the midpoint, possibly indicating easing selling pressure. The ETH/USDT token pair might realise a bullish move if it can overcome the moving averages, with a descent to strong support if it can’t.
Although Bitcoin creator, Casey Rodarmor’s January creation, Ordinals, have left a significant imprint on the blockchain and cryptocurrency community, it was not without disputes. These differences of opinion revolved around the perceived harm the Ordinals might inflict on the Bitcoin network and its spirit, while the other camp viewed it as a revolutionary progression of the existing technology.
In the sphere of digital currency, the only certainties are the waves of uncertainty. That’s why staying updated with the market trends is crucial for cryptocurrency enthusiasts savouring the thrill orchestrating the symphony of numbers.
Source: Cointelegraph
