Bullish view
Buy the BTC/USD pair and set a take-profit at 88,000.
Add a stop-loss at 80,000.
Timeline: 1-2 days.
Bearish view
Sell the BTC/USD pair and set a take-profit at 80,000.
Add a stop-loss at 88,000.
Bitcoin price pulled back this week as the US Dollar Index (DXY) and Treasury yields continued soaring. BTC/USD dropped to the important support level of 82,758, its highest point in May this year.
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Bitcoin Price Drops as US Dollar and Bond Yields Jump
Bitcoin retreated as the US dollar and Treasury yields continued to strengthen. The US Dollar Index (DXY) climbed to 102.53, its highest level since April 10 and more than 7.3% above its low for the year. The rally extended after the Federal Reserve released the minutes of its latest meeting, which showed that all officials supported raising interest rates.
This trend is happening in the bond market, where the ten-year jumped to its highest level in over two decades. The ten-year yield jumped to 5.3%, while the five-year moved to 5.03%. These numbers are rising as investors remain concerned about the US economy as the public debt and deficit jumps. Bitcoin and gold tend to underperform the market whenever yields are rising.
Bitcoin also retreated as liquidations jumped. CoinGlass data shows that Bitcoin positions worth over $173 million were liquidated in the last 24 hours. In most cases, Bitcoin tends to underperform the market whenever liquidations are rising,
BTC/USD Technical Analysis
Bitcoin price moved sideways in the past few weeks. It dropped to 82,758, a notable level that coincides with the highest point on May 6 this year. Moving to that level confirmed a break-and-retest pattern, a common continuation sign in technical analysis.
The pair has formed a bullish flag pattern, which is made up of a vertical line and a horizontal channel. It has also remained above the Supertrend indicator.
Bitcoin has also formed a golden cross pattern in technical analysis. Therefore, the BTC/USD pair will likely have a strong bullish breakout, initially to a high of 87,185. A move above that level will point to more gains, potentially to the psychological level of 90,000. On the other hand, a drop below the support level of 80,000 will invalidate the bullish outlook.
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