Bitcoin faces the highest levels in the U.S. Dollar Index for 2023 as BTC’s price action wobbles.
$26,275 hugged $26,000 at the Sept. 24 Wall Street opening as a weekly close “nosedive” brought lasting consequences.
Bitcoin must preserve support now, analysis says
Data from Cointelegraph Markets Pro and TradingView showed the BTC price trajectory is uncertain after briefly piercing $26,000 support.
Sideways weekend trading soon turned sour into the new week, and upset overnight meant that bulls could not recoup lost ground.
“Bitcoin failed to break through local resistance in the form of a descending trend line, and it looks like a little bearish right shoulder may form,” analyst BaroVirtual, an ambassador for on-chain data platform Whalemap, summarized.
BaroVirtual uploaded a daily chart snapshot to X (formerly Twitter), showing a potential head-and-shoulders formation about to conclude.
“If true, BTC risks falling into the $22,000-$20,000 range,” they added.
Popular trader and analyst Rekt Capital, who previously envisaged the possible reappearance of the low $20,000s as part of a breakdown from a double-top structure, now places emphasis on holding current levels as support.
“Bitcoin could wick into the ~$25000-$26000 area on this current move down,” he wrote in part of a fresh analysis on Sept. 25.
“But if ~$26000 begins to act as resistance, then that could be a bearish contributing sign that the ~$25000-$26000 area is weakening as support. If BTC turns the ~$25000-$26000 area into new resistance, the price would collapse somewhere in the ~$22000-$24000 region to find a Local Bottom ‘C.’”
DXY surges to new 2023 highs
Macro markets, meanwhile, opened to another potential headwind for Bitcoin and crypto—an unrelentingly strong U.S. dollar.
Related: US government shutdown looms — 5 things to know about Bitcoin this week
The U.S. Dollar Index (DXY) continued its march higher, hitting 106.1—its highest since November 2022.
Since hitting 15-month lows in July, the DXY has climbed 6.5%, displaying strength that historically has hampered risk asset and crypto market performance.
“DXY is rocketing higher—to the detriment of BTC Crypto and other risk assets,” Matthew Dixon, CEO of crypto rating platform Evai, wrote in part of a reaction.
Dixon had previously eyed a potential cooling off in DXY strength, giving Bitcoin and altcoins room for a relief bounce.