Bitcoin (BTC) headed towards the $20,000 level as US stocks gained at the open on Wall Street on Oct. 17.
Stocks Rise as US Dollar Heads Lower
Data from Cointelegraph Markets Pro and TradingView showed the BTC/USD pair hitting $19,672 on Bitstamp, up 3.5% from the weekend lows.
The pair rose in line with equities, with the S&P 500 and Nasdaq Composite Index gaining 2.7% and 3.2%, respectively, in thirty minutes of trading.
The action was combined with weak US economic data in the form of the Empire State Manufacturing Index, which fell to -9.1 in October, well below the -4.3 forecast and September’s -1.5 reading.
“Manufacturing activity decreased in New York State, according to the October survey”summed up the New York Federal Reserve in a commentary on the data.
“The general business conditions index fell eight points to -9.1. Twenty-three percent of those surveyed reported that conditions had improved during the month and thirty-two percent reported that conditions had worsened.
In response, Michaël van de Poppe, founder and CEO of trading firm Eight, called the results “much worse than expected.”
“Top in yields and $DXY on the horizon. Bitcoin will go higher”, forecast.
With that, The US Dollar Index (DXY) continued to retrace recent gains on the day, targeting 112 and down 0.65%.
“Risk asset deflation in 2022 and Fed tightening, despite the world tilting toward recession, portend an elusive endgame,” Mike McGlone, senior commodity strategist at Bloomberg Intelligence, wrote in an email. summarize a new macro analysis.
“Lower price cure may be needed in commodities to reduce Fed dovishness and money supply slump. Cooling crude oil can replenish Bitcoin and gold.”
Research reinforces looming volatility
While traders were already forecasting some relief in the crypto markets on weekly time frames, other perspectives they reiterated the fact that in the long term, nothing had changed for Bitcoin for many months.
“It is very rare for BTC markets to reach periods of such low realized volatility, with almost all previous instances preceding a highly volatile moveOn-chain analytics firm Glassnode showed in the latest edition of its weekly newsletter, The Week On-Chain.
Alongside a chart of Bitcoin’s realized volatility, the researchers, including lead analyst Checkmate, argue that the market has reached a tipping point.
“Historical examples with one-week moving volatility below current value of 28% in a bear market have preceded significant price movements in both directions”they continued.
Concluding, Glassnode acknowledged that while the momentum for a potential price breakout is there, for example with BTC-denominated futures open interest reaching new all-time highs, there was “little discernible directional bias in futures markets. “
“Volatility is likely on the horizon, and Bitcoin prices are not known for staying put for long,” the bulletin stated.
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