Bitcoin is currently trading at $11,389 after a robust and renewed daily uptrend that started with the purchase of $50 million worth of BTC from Square. The company co-founded by Jack Dorsey, the CEO of Twitter has made several investments in the cryptocurrency industry throughout the years.
Today, we also found out about another huge Bitcoin investment from the hands of Stone Ridge. The company acquired $115 million worth of BTC, around 10,000 coins.
This time, the price of Bitcoin didn’t react positively, however, we know the cause of the recent pullback. The dollar index has strengthened and Bitcoin is inversely correlated to it.
A 0.50% move to the upside for the DXY made Bitcoin lose around 1.5% in the same time period. This is not the first time the U.S. dollar had a strong effect on the price of Bitcoin or cryptocurrencies in general. Similarly, stocks are also usually negatively affected by the increase in strength of the Dollar Index.
Bitcoin Price Analysis: Short-Term
Cryptoquant, an on-chain data provider of cryptocurrency metrics, has released a report stating that Bitcoin will ‘not dump any time soon’. Ki Young Ju, the CEO of Cryptoquant posted a Tweet with two charts showing that the Exchange Inflow Mean is not above the ‘danger zone’.
$BTC dumping is not going to happen.
All Exchanges Inflow Mean usually indicates how many whales are active on exchanges. Above 2 BTC is the danger zone, and we're still in the safe zone.
— Ki Young Ju 주기영 (@ki_young_ju) October 12, 2020
It seems that a high inflow of Bitcoin going towards exchanges usually represents strong selling pressure. Back in March, this number spiked just before the massive crash of March 12.
On the daily chart, the price of Bitcoin has managed to climb above the 50-SMA and the 100-SMA, turning both into support levels. The next clear resistance level is $12,000, a psychological level, followed shortly by $12,050, the high of September 1.
The next biggest resistance point is $12,468, the 2020-high. The last point before $13,000. The MACD has been bullish for the past month and continues rising.
The RSI was close to being overextended, however, the last time this happened on July 2020, it didn’t stop the bulls from pushing Bitcoin towards the 2020-high.
Are we going to see Bitcoin finally cracking $12,000 for good and climbing towards $13,000? The interest in the cryptocurrency is quite apparent, considering many global companies are investing millions.