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On the four-hour timeframe, Bitcoin (BTC) is trading at $26,267 with a bearish bias. As big SMAs face tough resistance on the upswing, the technical structure suggests 5% further losses. Investors’ concerns about the influence of the US dollar on the large crypto may be exaggerated, especially in the long run.
On Friday last week, the US Dollar Index (DXY) reached its highest level in nearly ten months, reflecting increased confidence in the US dollar relative to other fiat currencies such as the British pound (GBP), Euro (EUR), and Japanese yen (JPY).
After a golden cross formed on the daily chart (see below), the US dollar became even more bullish. When the 50-day moving average crosses over the 200-day MA, this is a bullish indication. This is frequently interpreted as a precursor to a strong rally in technical analysis.
As a result, investors are concerned about the impact of a strong dollar on Bitcoin and the whole cryptocurrency industry. At the moment, the BTC price appears weak as it falls below all important levels, with the $26,000 support level under threat of being breached.
Bitcoin Price Faces More Losses to $25,000
On the four-hour chart, BTC price movement had resulted in the construction of an inverted V-shaped pattern.
The pioneer cryptocurrency was receiving rapid support from the psychological level of $26,000.
A four-hour candlestick closure below this level would cause the price to fall to $15,600, completing the V-shaped pattern.
If this level is breached, sellers will move BTC lower, accumulating demand side liquidity below it toward the $25,000 psychological threshold. This would imply a 4.66% decrease from the current pricing.
The flagship cryptocurrency was also seeing significant hurdles on its road to recovery. If the Bitcoin price rises from its current level, it will encounter the first hurdle at $26,450, which is supported by both the 100 and 20 SMAs.
It’s worth noting that the 20 SMA had just delivered a sell signal when it crossed below the 100 SMA. This bolstered the bad narrative surrounding BTC.
Additional restrictions exist at the $26,725 SMA and the $27,000 psychological level. Rising higher would bring the swing high of $27,500 into play.
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