Bitcoin price loses support at $19k as the surging dollar takes a toll on global markets
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(Kitco News) - Global asset prices had nowhere to run in the face of a surging US dollar on Friday as the DXY climbed to a daily high of 113.226, its highest level since May 2002.
As a result of the rapid climb in the value of the DXY, global financial markets were plunged into the red, with the S&P, Dow and Nasdaq all seeing their worst daily performance in weeks, closing the day down 2.62%, 2.59% and 1.80%, respectively.
The story was the same for the crypto market, which saw a majority of the top-200 tokens trading in the red as fears of a continuation of aggressive Federal Reserve policies have traders rethinking their exposure to the risky asset class.
Data from TradingView shows that a failed attempt by Bitcoin (BTC) bulls to rally above resistance at $19,500 led to a slide below support at $19,000 to hit a daily low of $18,541 before reinforcements arrived to bid it back above $18,900.
BTC/USD 4-hour chart. Source: TradingView
The top crypto’s struggle to generate any momentum was cited in the morning BTC update from senior Kitco technical analyst Jim Wyckoff, who noted that “The keen global markets turmoil late this week is not benefitting the BC bulls, who were hoping the marketplace anxiety would put a safe-haven bid into Bitcoin.”
As it stands now, “The bears have the overall near-term technical advantage amid a price downtrend in place on the daily chart,” Wyckoff said. “The path of least resistance for prices is presently sideways to lower.”
This potential for a bearish path moving forward was further validated by market analyst Rekt Capital, who posted the following tweet warning about a long-term support level flipping into resistance.
#BTC continues to hover just below the red Range Low of its macro range— Rekt Capital (@rektcapital) September 23, 2022
What this means is that an old support is potentially flipping into new resistance
Monthly Close like this would confirm this technical shift and could lead to bearish continuation$BTC #Crypto #Bitcoin pic.twitter.com/rX5G0iOH2A
Caleb Franzen, senior market analyst at Cubic Analytics, likewise pointed to a troubling development on the Bitcoin chart as the appearance of a large head and shoulders pattern portends further declines in the top crypto.
Zoomed-in view of the head & shoulders pattern for #Bitcoin pic.twitter.com/AI0YqO7zTJ— Caleb Franzen (@CalebFranzen) September 23, 2022
Overall, analysts appear to be in agreement that right now might not be the best time to go all-in and buy the dip as a surging dollar and multiple global headwinds indicate that there is further downside ahead.
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Red across the altcoin market
The days that Bitcoin struggles are known to hit the altcoin market even harder, and Friday was no different.
Data from CoinMarketCap shows that more than three-quarters of the top 200 tokens by market cap are in the red for the day, while those that are in the green experienced minimal gains.
Daily cryptocurrency market performance. Source: Coin360
The only two notable mentions include Reserve Rights (RSR), which gained 11.65% and traded at $0.0073, and Cronos (CRO), which saw its price increase 10.10% to trade at $0.1171.
The overall cryptocurrency market cap now stands at $920 billion, and Bitcoin’s dominance rate is 39%.