- US Dollar Index (DXY) hit a three-week high of 92.96 as stronger-than-expected retail sales data.
- On Friday, Bitcoin is trading with a slightly bearish bias at 47,445 level, losing around -0.70%.
- Forex trading market participants should look for a buy trade above the $46,735 level. The initial target remains at $47,991 and $49,090.
On Friday, Bitcoin is trading with a slightly bearish bias at the 47,445 level, losing around -0.70%. The BTC/USD pair ended the day at $47,786.0, having reached a high of $48,518.0 and a low of $48,080.0.BTC/USD remained flat throughout Thursday’s trading session and lost a minor portion of its previous daily gains. The Bitcoin price prediction remains bullish above the 50-day EMA resistance level of 46,732.
The leading cryptocurrency faced pressure on Thursday after the protests against the newly launched Bitcoin Law in El Salvador picked up the pace. Protesters in El Salvador kicked against the recently enacted Bitcoin law, destroying a cryptocurrency kiosk in the capital city of San Salvador.
The crowd of journalists and protestors burnt down the Chivo-supported kiosk, and videos regarding the incident went viral on the internet, further putting pressure on BTC/USD prices. The protestors did not stop there and posted anti-BTC logos and signs on the new Bitcoin machines that the government of El Salvador implanted for converting BTC into cash.
Bitcoin Law implementation in El Salvador
The signs, like the ones saying “democracy is not for sale,” were posted on BTC machines in an attempt to show anger about the recent Bitcoin Law implementation in El Salvador that has made BTC legal tender in the country. Furthermore, in a report released by S&P Global, it was mentioned that risks associated with El Salvador’s adoption of bitcoin as parallel legal tender to the US dollar. This seemed to outweigh its potential benefits, and that there were immediate negative implications for credit.
It further said that the use of bitcoin threatens a potential deal between El Salvador and the IMF. Fears grew that the Central American nation would not reach a potential $1 billion loan agreement with the IMF and that it faced negative credit implications linked to its use of bitcoin. The environment’s negative developments added pressure on BTC/USD, and the cryptocurrency dropped on Thursday.
Stronger US Dollar Drags Bitcoin Prices Lower
Another reason behind the declining prices of BTC/USD on Thursday could be the rising US dollar price, as both have a negative correlation. On Thursday, the US Dollar Index (DXY) hit a three-week high of 92.96 as stronger-than-expected retail sales data accelerated the greenback’s accumulated strength.
The higher-than-predicted figures for retail sales data showed improved consumer confidence that raised expectations that the Fed might mention any hints about tapering economic support in its upcoming monetary policy meeting. On the other hand, according to Changpeng Zhao, the CEO of Binance, a growing number of traditional monetary institutions have recently turned their attention to cryptocurrencies, particularly bitcoin. Moreover, he mentioned that the trading platform would change its structure to comply with the regulatory requirements.
He also believed that global financial institutions and investors have already realized the merits of the digital asset as they have started jumping on the cryptocurrency bandwagon. Lastly, he further explained that BTC was a currency, multi-asset class technology, and a whole new platform. This was the reason that many financial institutions saw BTC as an investment instrument.
Bitcoin Price Prediction – Daily Technical Levels
Pivot Point: 47794.7
Bitcoin Price Prediction: 61% Fibonacci Retracement Pushing BTC Lower
Bitcoin price prediction remains bullish above the 50-day EMA resistance level of 46,732 level. In the 4-hour timeframe, the BTC/USD pair has completed a 61.8% Fibonacci correction level at 47,990.
On the 4-hour timeframe, Bitcoin is forming neutral candles that are suggesting indecision among investors. On the bearish side, Bitcoin may find immediate support at the 46,735 level. This level marks a 38.2% Fibonacci retracement level. A bearish breakout of this can extend the selling trend until the 45,325 level.
On the bullish side, the break out of the 47,940 resistance level could extend further bullish momentum in Bitcoin prices until the 50,606 level. However, on the way to the 50,606 resistance level, Bitcoin may face slight resistance at the 49,130 level. A 61.8% correction level extends this particular resistance level.
The oscillator indicator, like Stochastic RSI, has entered the oversold zone. Thus, the odds of a bullish correction remain strong over 46,730 levels. While the 50 daily EMA (exponential moving average – red line) stays at 46,730, it may support Bitcoin’s bullish trend.
Therefore, Forex trading market participants should look for a buy trade above the $46,735 level. The initial target remains at $47,991 and $49090. Alternatively, the traders can place a sell stop below the 46,650 level to target 45,325 and 44,500 support levels. All the best.
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