Bitcoin reached a record high of $ 58,300 last weekend.
Since then the indicators have turned red as the price of Bitcoin has fallen by more than 20% this week.
The decline is the worst weekly decline for the leading cryptocurrency since March 2020.
The dollar’s recovery and its impact on the crypto market:
The dollar’s rally is not good news for Bitcoin as the two have an inverse relationship, as many analysts point out.
For example, with Bitcoin rising more than 295% in late 2020, the US dollar index (DXY) plunged to its lowest level in 32 months.
In this regard, “Vijay Ayar”, President of “Luno” in the Asia Pacific region sees:
The dollar strengthens and recovers.
This is a good indication that bitcoin and cryptocurrencies are expected to drop.
May also indicated that risky assets, including digital currencies, were being hit hard as they were witnessing global selling.
This is the reason for the slide of stocks and cryptocurrencies before the end of the week and continuing until today, “May” stated by saying:
Bitcoin’s rough correction comes amid wider chaos in global markets, as the surge in bond yields heralds mounting expectations that growth and inflation are moving higher and forcing traders to reassess their positions across multiple asset classes.
Bitcoin and the fight with the $ 50,000 level continues:
Carl Martin, a cryptocurrency trader, recently revealed that $ 50,000 may be the new resistance level, which the leading cryptocurrency has to fight, and that may take some time.
The flagship cryptocurrency is trading at $ 44,630 at the time of writing, according to Coingecko.
This price drop has caused Bitcoin to drop its value from a recent high of more than $ 1 trillion to $ 833 billion at the time of writing this article.
Historically, Bitcoin has gone through multiple sharp corrections in its continuous bullish cycle.
Between 2016 and 2017, the Bitcoin business experienced six corrections.
For example, on November 13, 2017, Bitcoin hit a low of $ 5,844, then hit $ 20,000 after 34 days.
Currently the coming days will tell us how the current Bitcoin correction will end.