Bitcoin’s current price is hovering above the $61k level, showing signs of a potential recovery. However, Crypto World analyst Josh suggests that Bitcoin may face sideways movement or a minor rally in the near future. Despite this, the long-term outlook remains bearish unless Bitcoin can successfully break through key resistance levels.
Key Support & Resistance Levels
Bitcoin is currently finding support between $60,000 and $61,000, which has proven to be strong in recent days. If Bitcoin breaks below this support, the next support levels to monitor are $59,500, $58,000, and a more significant support range between $56,000 and $57,000.
If Bitcoin sees a short-term rebound from oversold conditions, we can anticipate resistance around $61,900 and $63,300. Further resistance levels may be encountered at $64,500, and then between $67,000 and $68,000, where Bitcoin has faced rejection multiple times.
DXY Breakout & Bearish Impact on Bitcoin
The recent breakout of the U.S. Dollar Index (DXY) suggests a bearish signal for Bitcoin. The DXY has formed a double bottom pattern, indicating a potential uptrend for the U.S. dollar. Historically, Bitcoin and the DXY have exhibited an inverse relationship, with Bitcoin’s price often declining as the DXY strengthens.
Although the correlation between Bitcoin and the DXY is not always precise, the trend of moving in opposite directions is commonly observed. As the DXY surged, Bitcoin’s price experienced a downward trend, reinforcing this negative correlation.
Bitcoin’s Short-Term Oversold Signal
Despite the bearish pressure from the DXY, Bitcoin has shown a short-term bullish signal in the form of an oversold condition. This indicates that the recent price decline of Bitcoin has been excessive, leading to an oversold status based on technical indicators like the Relative Strength Index (RSI).
When Bitcoin is oversold, it suggests that the selling pressure has been intense, potentially leading to a short-term price rebound. However, it does not guarantee a sustained uptrend for Bitcoin in the long term.
