Spot gold loses 2% as USD strength increases, surpassing the year’s prior heights, while BTC/USD declines by $1,000.
On July 5, when Wall Street opened, Bitcoin (BTC) experienced daily lows as the value of the US dollar violently increased.
Another 20-year record is achieved by USD.
According to Cointelegraph Markets Pro and TradingView data, Bitcoin/USD dropped to $19,281 on Bitstamp as the lengthy Fourth of July weekend came to a successful close.
The day before, the pair had had last-minute gains, but these petered out when Wall Street trade resumed and the strength of the USD wiped out gains in risky assets and safe havens.
On the other hand, the U.S. dollar index (DXY) reached 106.59, a level not seen since December 2002 and above other breakouts from this year’s second quarter.
As a result, Bitcoin analysts watched for indications of a trend reversal to calm the markets for digital currencies.
“Euro prices are now at record highs of $1.033. When last seen, DXY, of course, was going up like a rocket between the years 2002 and 2003 “Michal van de Poppe, a contributor to Cointelegraph, noted that the euro was moving near parity with the USD in his remark.
Caleb Franzen, a senior market analyst at Cubic Analytics, added a comment on how the DXY provided insight into how investors felt about the state of the economy.
“While the currency has been increasing over the previous week, yields have been declining. This dynamic demonstrates that investors are scurrying for protection due to increased economic worries “read a portion of a tweet.
Crypto Fear & Greed Index reaches a two-month high.
While some volatility returned to the cryptocurrency markets, mood had not yet been affected by the overabundance of the dollar.
The day’s reading on the Crypto Dread & Greed Index was 19/100, which is still considered to be “severe fear,” but is also the highest rating since prior to the Terra LUNA fiasco in May.
As Cointelegraph also noted, investment manager ARK Invest said that given the present situation, it was remained “neutral to bullish” on BTC.
While analyzing the attitude of the Bitcoin futures market, Edris, a contributor to the on-chain analytics site CryptoQuant, cautioned against drawing any conclusions about a possible comeback.
According to Edris, the taker buy/sell ratio, which shows whether buyers or sellers are in charge, saw some respite on the day. However, the change should not be taken too seriously.
A blog article stated, “Note, however, that it might just be a consolidation or a positive retreat before another continuation lower.”
“So, many other factors should be considered closely in the coming weeks in order to determine if a bullish reversal or another bull trap could be expected.”
