September 28, 2022


Bitcoin (BTC) rose to daily resistance at the Wall Street open on August 3 as US stocks gained on relief against Taiwan.

BTC/USD 1 hour candlestick chart (Bitstamp). Source: TradingView

Stocks earn as USD coils

Data from Cointelegraph Markets Pro and TradingView showed that BTC/USD is back in the area just below $23,500, which had been seen as resistance since the beginning of the month.

The pair had previously held the same zone as support and was now deciding whether a new resistance/support hit was on the cards.

For popular Crypto trader Tony, $23,500 was thus the price to watch the big BTC.

On the downside, fellow trader Pentoshi is emphasized the area between $21,800 and $22,000 as the “line in the sand” for BTC.

Stocks performed well on the day, meanwhile, with the S&P 500 and Nasdaq Composite Index up 1.2 percent and 2 percent, respectively, after the open. News that US Speaker Nancy Pelosi had begun a visit to Taiwan without repercussions from China opened the mood.

The US Dollar Index (DXY), following its own solid gains earlier in the week, consolidated after meeting resistance at 106.8 on the hourly time frame. Intraday lows match May highs, analysis famouswith the potential for new two-decade highs still in play in what would represent friction for cryptocurrencies and risk assets.

“As the dollar begins to show possible signs of strength (and yields begin to move higher), will stocks continue to remain resilient? Price action throughout 2022 tells us no,” market analyst Caleb Franzen warned.

US Dollar Index (DXY) 1 Hour Candlestick Chart. Source: TradingView

ARK taps “pop-up danger environment”

In a summary of the status quo in Bitcoin and Ether (ETH), meanwhile, investment firm ARK Invest painted a mixed picture of where the market could go in 2022.

Related: ARK Invest ‘Neutral to Positive’ on Bitcoin Price as Analysts Expect Capitulation

In the latest edition of his research series, “Bitcoin Monthly,” ARK analysts, including CEO Cathie Wood and others, said “all eyes” are now on macros.

“Given the positive correlation between bitcoin and US stocks since COVID, the US being the biggest mover in bitcoin prices suggests an emerging risk market environment,” they wrote.

The United States, ARK added, likely accounted for most of the buying interest in Bitcoin during the July rally.

Going forward, however, the chances of an extended rebound were uncertain. Describing its stance as “neutral”, ARK gave a possible “unlikely” downside target of just under $14,000.

“Comparable to the sell-off at the height of the COVID crisis, the price of bitcoin has not reached the delta cost basis, a price-adjusted cost basis that subtracts the lifetime moving average of the purchase price from the purchase cost basis and serves as bitcoin’s strongest support level,” the report said.

“While the likelihood of it touching the delta cost base has decreased, bitcoin’s downside risk in a bear market is technically at the delta cost base, currently $13,890.”

Bitcoin cost base graph (screenshot). Source: ARK Invest

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.