Bitcoin Faces Pressure as US Dollar Strengthens

Bitcoin experienced a downward trend on Thursday, influenced by a stronger US dollar. The cryptocurrency relinquished some of the gains made during Wednesday’s impressive surge, driven by a dovish stance from the Federal Reserve.

The price of Bitcoin fell by approximately 5% to a low of $64,600 by late afternoon UTC, down from over $68,000 earlier in the day. Concurrently, the CoinDesk 20 Index (CD20) saw a 3.5% decline from its peak, with altcoins generally outperforming Bitcoin throughout the day.

Bitcoin cryptocurrency

Altcoins Outperform Bitcoin

During the 24-hour period, Ripple’s XRP, Filecoin’s FIL, and the Internet Computer’s ICP surged by 6%-7%. In contrast, native tokens of layer 1 networks such as Solana (SOL), Avalanche (AVAX), and Aptos (APT) experienced losses ranging from 2%-3%.

The surge in altcoins and the decline in Bitcoin’s value were attributed to the resurgence of the US dollar following a surprising decision by the Swiss central bank to reduce interest rates by 25 basis points. This move erased the significant drop in the US dollar’s value from the previous day when Federal Reserve Chair Jerome Powell adopted a dovish tone despite higher-than-expected inflation figures.

Market Predictions and Analysis

Market analytics firm Swissblock indicated that Bitcoin had completed its pullback before the bounce on Wednesday, nearly hitting the projected price target of $58,000-$59,000. Analyst Henrik Zeberg from Swissblock expressed optimism about the future, stating, ‘Now much higher levels are coming.’ He also forecasted that altcoins and Bitcoin miners would excel in the upcoming phase of the uptrend.

Crypto trader Jelle suggested that the correction’s bottom had been reached as long as Bitcoin maintained the $65,000 level. Jelle further mentioned the need for Bitcoin to break above the $69,000 price level, which marked the peak of the market cycle in 2021, to reignite its rally to higher prices.

Conclusion

In conclusion, Bitcoin faced downward pressure due to the strengthening US dollar, with altcoins outperforming Bitcoin in the market. Analysts and traders remain optimistic about the future performance of Bitcoin and altcoins, anticipating further price increases in the upcoming period.

With a sharp eye for detail, this journalist has a knack for uncovering the latest trends and stories in the world of Bitcoin and cryptocurrency. In their free time, they enjoy hiking and experimenting with new recipes in the kitchen.