Late April I made an analysis on the Dollar Index (DXY). In that analysis I argued that the DXY had a huge impact on the price of Bitcoin and crypto in general.
Since then, the DXY has risen further and Bitcoin's price fell from 39K to 29k. However, there might finally be a light at the end of the tunnel.
If you look back at the DXY's history, you see that it trends very strongly. We either go up very hard or down very hard. Furthermore, the DXY has been severely overbought on the weekly RSI, and is currently seeing the biggest correction we've seen in a very long time.
If the bearish move continues, we can expect further bullish price action for the crypto and stock markets.
question - why would yo think that dxy would go down knowing inflation is still very high and fed policy is right now to tame it.
FieryTrading
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@sellproduct, Good question. I doubt it will go down all the way. I'm more looking at a bearish correction for a couple of weeks instead of a full trend reversal. I think there's more pain to come for crypto and stocks, but we're due a relief-rally. A falling DXY (which came from severe overbought conditions) will help with that.
Super_B_XinR
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@FieryTrading, The first oversold appearance of the indicator does not mean that it is possible to be bearish, but rather to analyze it in conjunction with the fundamentals, or the more oversold it appears to be, the more it rises.
fb2a1004
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@FieryTrading, I think since it broke the trend line without any doubt, it'll retest trend line and continue going up. Look at RSI at Sep 2014, overbought but still going up.
Calderian
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Great analysis. Could this be a retest of the upper trendline? I have been following you for more than a year, keep it real bro!
FieryTrading
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@Calderian could very well be just a retest. Thanks for the support!