Bearish view
- Set a sell-stop at 53,750 (overnight low).
- Add a take-profit at 52,000 and a stop-loss at 55,000.
- Timeline: 1-2 days.
Bullish view
- Set a buy-stop at 54,500 and a take-profit at 56.,000.
- Add a stop-loss at 53,000.
The BTC/USD price dropped sharply in the overnight session, erasing some of the gains made during the weekend. The Bitcoin price is trading at $54,550, which is slightly above the overnight low of $53,750.
Bitcoin price falls as US dollar gains
The current price action of the BTC/USD is mostly because of the overall strong US dollar. The dollar index has risen by 0.10% as the currency strengthens against key peers. It has gained against the euro, the Australian dollar, and the British pound, among others.
This performance is happening at a time when the bond market has seen some stability. The yield of the ten-year government bond has dropped to 1.66%, down from Friday’s high of 1.73%. The other longer and shorter-dated government bond yields have also declined ahead of auctions.
The BTC/USD is also falling as demand for the cryptocurrency wanes. In the past few weeks, no major company has announced its investments in Bitcoin. A while back, analysts were expecting more companies to invest in the digital currency after the big investment by Tesla and Square. Also, the impacts of the new $1.9 trillion stimulus package has started to wane.
Meanwhile, the Bitcoin price is falling even as its demand rises in Turkey, where the country’s currency clashed on Monday. According to Google Trends, search for the term Bitcoin in the country rose to a peak popularity level of 100. This could be a sign that more people in the country are considering moving to the digital currency.
BTC/USD technical forecast
The BTC/USD pair has been in a relatively strong upward trend since February 28 when it fell to 42,967. It rallied and reached an all-time high of close to 62,000 in March and then started struggling. It has dropped by more than 11% after reaching its highest level this year.
Today, the BTC/USD is trading at 54,550, which is slightly below the ascending trendline that connects the lowest levels in February and in the first two weeks of March. It has also moved below the 25-day and 15-day exponential moving averages (EMA) while the Relative Strength Index (RSI) has moved close to the oversold level of 30.
Therefore, the overall outlook of the Bitcoin price is bearish. A further decline below 53,740 will be a vindication for bears and will open the possibility of another decline to 52,000. However, a bounce above 55,000 will invalidate this prediction.
