Arguably crypto’s biggest villain could be flashing a sign that Bitcoin, and crypto, are about to make a move upward.  Covered: Bitcoin v. Fiat DXY Local Top Bitcoin v. Fiat In crypto circles, the word “fiat” is a pejorative (see: r/cryptocurrency). Considering that, it should be no surprise to the crypto faithful that there is […] The post Analyst Says Bitcoin Will Follow This Crypto Villain’s Next Big Move appeared first on CryptosRus.

Analyst Says Bitcoin Will Follow This Crypto Villain’s Next Big Move

Arguably crypto’s biggest villain could be flashing a sign that Bitcoin, and crypto, are about to make a move upward. 

Covered:

  • Bitcoin v. Fiat
  • DXY Local Top

Bitcoin v. Fiat

In crypto circles, the word “fiat” is a pejorative (see: r/cryptocurrency). Considering that, it should be no surprise to the crypto faithful that there is an inverse relationship between the U.S. Dollar — the BTC of Fiat — and Bitcoin — the greenback of crypto.

“The DXY (or U.S. Dollar Index) has shown historically consistent, and significant inverse correlation with macro Bitcoin runs over the last 10 years,” says Bitcoin analyst TechDev. “The parabolic portion of the 2017 impulse was accompanied by a significant DXY drop, as was the recent move from late 2020 to early 2021.

In other words, historically, when Bitcoin mooned, the greenback cratered. Interestingly enough, according to some data, it looks like the U.S. Dollar is looking like it’s about to make a significant move.

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DXY Local Top

“The parabolic portion of the 2017 impulse was accompanied by a significant DXY drop, as was the recent move from late 2020 to early 2021,” TechDev said. In the chart above, you can see exactly how clear the inverse between the two rival currencies is. The white line (U.S. dollar) drops significantly in 2020, while the blue line (BTC) rises inversely.

And, it appears to be happening again.

“The DXY looks to be approaching another local top, which will likely correlate with another leg up on Bitcoin,” TechDev said. “Unconfirmed 2W hidden bearish divergence between DXY and its RSI has formed, with RSI the highest it’s been in 7 years. He added, “DXY is also approaching the 100 level, which has been major resistance since 2015, save for the late 2016 deviation.”

However, the analyst also cautions there could be “one last push” from the U.S. dollar. As the chart shows above, there is some room between the rejection level and where the U.S. Dollar currently sits. But even if there is another leg up, “a local top in DXY is very likely near.”

Though, TechDev also points out that a move down for the U.S. Dollar isn’t necessarily necessary for a move up for BTC: “Not all Bitcoin impulses have required a falling DXY.”

For example, during the first part of this most recent Bitcoin cycle, the DXY saw a period of sideways action. TechDev anticipates that could be the case for the upcoming fifth wave, which TechDev explained last month is the forthcoming top for Bitcoin.

In other words, not much has changed. You’re still rooting for fiat to fail — or at least go sideways.

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The post Analyst Says Bitcoin Will Follow This Crypto Villain’s Next Big Move appeared first on CryptosRus.