- Bitcoin price has surged to the highest point since November.
- The US dollar index has plunged to the lowest point since June.
- The fear and greed index has soared to the greed area.
Bitcoin price soared to the important resistance level at $21,465, which was the highest level since November 5. The BTC/USD price has jumped by more than 36% from the lowest level in 2022. This means that BTC has outperformed the Dow Jones and Nasdaq 100.
Fear and greed index rises
The Bitcoin comeback has been characterized by the rise of fear and greed index and the collapse of the US dollar index (DXY). It has also coincided with the strong rebound of global indices like the Nasdaq 100, DAX, and CAC 40 indices. Other assets like gold and silver have also rallied recently.
The fear and greed index tracked by CNN Money has surged to 65, which was the highest level since December 9. Most parts of the index have moved to the greed and extreme greed area. Safe haven demand and put and call options are in the greed level. Similarly, the stock price breadth and strength have moved above the extreme greed area.
Meanwhile, the crypto fear and greed index has risen to 52, which is neutral with a greed tilt. This index looks at key issues like volatility, market momentum, social media, and dominance. Bitcoin and stocks tend to do well when the fear and greed index is in the greed level.
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Bitcoin price has risen because of the falling US dollar index. The DXY index has crashed from last year’s $115 to about $101.7, which was the lowest level since June 2022. This means that it has crashed by more than 11.4% from its highest point last year.
The US dollar index has plunged because of the rising hopes of a Fed pivot. This is after data showed that inflation dropped for six straight months in December. Wholesale prices also plunged in December. At the same time, there are fears of a recession as companies like Microsoft, Coinbase, and Amazon announced major layoffs.
Bitcoin price prediction
The daily chart shows that the BTC price has been in a strong bullish trend in the past few days. It rose to a high of $21,465, which was the highest level in November. The 50-day and 25-day moving averages have made a bullish crossover pattern. At the same time, the Relative Strength Index (RSI) has moved to 89, which means that it is extremely overbought.
Therefore, Bitcoin will likely continue rising in the coming weeks. If this happens, the next key resistance level to watch will be at $25,000.
