BTC/USD Forex Signal: Bitcoin Path to 17,000 Gets Clearer – 07 September 2022
The BTC/USD price dropped as the US dollar index continued its bullish trend.
Sell the BTC/USD pair and set a take-profit at 17,000.Add a stop-loss at 19,800.Timeline: 1-2 days.
Set a buy-stop at 19,500 and a take-profit at 21,000.Add a stop-loss at 18,000.
The BTC/USD price continued dropping in the overnight session as concerns about interest rates and demand continued. It also crashed as the ongoing stock and bond sell-off continued. The pair fell to a low of 18,900, which was the lowest level since July.
Market sentiment worsens
Bitcoin and other cryptocurrencies continued their sell-off in the overnight session as the market sentiment worsened. American equities also declined, with the Dow Jones and S&P 500 falling by more than 0.40%.
Meanwhile, the sell-off in the bond market continued, with the yield of the 10-year rising to 3.34%. The 30-year yield rose to 3.485 while the 2-year rose to 3.5%. Meanwhile, CNN Money’s fear and greed index moved back to the fear zone of41 while the VIX index soared.
This performance reflects the rising fear that the Federal Reserve will continue hiking interest rates in the coming months. Jerome Powell confirmed about this view in his speech at the Jackson Hole Symposium.
Recent economic numbers are also supportive of more interest rate hikes. For example, data published on Tuesday revealed that activity in the non-manufacturing sector expanded at the fastest pace in several months in August.
Also, data published on Friday showed that the country’s labor market is still strong even as the unemployment rate rose slightly. Therefore, analysts expect that the bank will hike interest rates by either 0.50% or 0.75% this month.
The BTC/USD price dropped as the US dollar index continued its bullish trend. The dollar index has surged by more than 1% this week and is trading at a two-decade high of $110.30. Bitcoin has an inverse relationship with the US dollar.
At the same time, the hype surrounding the upcoming Ethereum merge has started fading. The event will happen on September 15 if everything goes according to plan.
The BTC/USD pair has been in a strong bearish trend in the past few weeks. This week, it managed to move below the important support level at 19,521, where it had struggled moving below several times since August. It has also moved below all moving averages while the MACD remains below the neutral point.
The BTC/USD also dropped below the second support of the standard pivot points. Therefore, the pair will likely continue falling as sellers target the next key point at 17,000.
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