The world’s largest cryptocurrency Bitcoin (BTC) is up 5% in a weekend rally moving past $30,000 levels. Last week, Bitcoin continued to move downwards with a major decoupling from the tech stock and the Nasdaq-100.
It looks like with the Sunday gains, Bitcoin is trying to catch up on the lost ground. With the recent gains, BTC has managed to recover the negative gains and currently trading at flat levels on the weekly chart. On the other hand, the Nasdaq 100 ended last week with nearly 7% gains.
Crypto analyst Lark Davis believes that the relief rally was likely. Furthermore, he also explains Bitcoin’s correlation with the Dollar Index.
The Dollar Index $dxy is falling.
Historically this is good for #bitcoin in the opposite way that Dollar rallies are bad for BTC price. pic.twitter.com/7phhxJZNgG
— Lark Davis (@TheCryptoLark) May 30, 2022
Bitcoin (BTC) Heading for New Lows
After the recent price jump, the bigger question is whether Bitcoin could sustain this relief rally. Antoni Trenchev, co-founder and managing partner of crypto lender Nexo believes that Bitcoin is poised to be heading for new lows. Speaking to Bloomberg, Trenchev said:
“This is the type of de-correlation nobody wanted. Bitcoin has yet to test its sub-$26,000 May 12 lows. One senses it’s only a matter of time, given Bitcoin’s failure to mirror the Nasdaq’s gains in the past week.”
In a note to clients, Mark Newton, head of technical strategy at Fundstrat said: “One final pullback to test May 12 lows near $25,401 still looks more likely before any meaningful low is in place”.
Bitcoin along with stock has witnessed a massive price correction in the month of May. However, stocks already started recovering, however, Bitcoin and the broader crypto space continued to head down. If the look at the broader crypto market performance, Bitcoin has been relatively holding the ground while altcoins are crashing as if there’s no tomorrow.
The weight of the global macros is still likely to have an impact on crypto going ahead. The Fed will continue with more rate hikes until the U.S. inflation numbers come under check.
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.