This is a daily analysis of Coindesk analyst and chartered market technician Omkar Godbole.
Bitcoin Continue to win space, in accordance with the reverse head-and-shoulder breakout from the beginning of this week, opening the door for a rally to $ 120,000.
Prices are crossed over the 50-day simple sliding average (SMA)a widely traced momentum indicator. In addition, the Guppy Multiple Sliding Average (GMMA) Indicator teases a renewed Turkels. Overall, these two developments may be drawing speed -chasers to the market and speeding up the price increase.
That said, there are at least three reasons to continue to be careful. Let’s look at them individually.
BTC is approaching bull -fatigue zone
BTC closes at the bull -tired zone over $ 115,000.
While previous patterns do not guarantee future results, it is noteworthy that Bitcoin’s Bull Momentum since July has consistently weakened over the level of $ 115,000, which is reflected by the long upper wicks on the last two monthly lights.
These long weddings indicate that although bulls pushed prices to new record highs over $ 124,000, strong sales pressure off the price back under $ 115,000, signaling a key resistance level and potential hesitation among buyers.
Does the dollar index have price -born interest rate reductions?
With the US labor market weakened at a fast pace, futures traders have priced at 70 basic points (BPS) of rate cuts by December 31 There are almost three 25-base points-interest coverings starting from September 17. In addition, dealers have priced II total 125 BPS to ease in July 2026, which would take the benchmark rate down to 3% to 3.25% range from the current 4.25-4.50 range.
Market participants appear to be sure that the central bank will look past the sticky inflation, which is highlighted with Thursday’s Consumer Price Index and reduces the rates to support the labor market and economic growth. These dovic expectations are sharply contrasted with those from the Fed’s peers, such as the European Central Bank (ECB)which appears to have gone on from taking outscuts. In other words, the speed differential favors USD weakness.
Still, the dollar index, which measures Greenback’s value against larger Fiat currencies, continues to hover in the recent interval from 97.00 to 98.00. The index has fallen only 0.20% to 97.55 this week despite the sharp increase in the bold rate cut pricing.
This raises the question: Has the dollar already priced in the fat rate cut? In that case, it could recover from here and uncover gains in the dollar-denomined assets such as BTC and gold.
The chart shows that the dollar sale has run out of steam since the index hit a low level of 96.37 on July 1st.
From the writing, Bollinger Bands or Volatility Bands were two standard deviations over and during the index’s 20-day SMA on their tightest since March 2024. The so-called clamp means that a big move in both directions could soon happen. A bullish a maybe not bodied well for btc.
Generations Bullish Shifts in 10-year-old yield
Expectations for rapid interest rates have given rise to the expectation of a sharp decline in benchmark 10-year treasury outcomes, which affects the loan costs for consumers, businesses and governments. Therefore, a slide in the 10-year dividend is likely to lead to greater risk taking across both economy and financial markets.
However, long -term monthly charts indicate a generation bullish shift in momentum for yields, suggesting that the disadvantage could be limited. So the expected flood of money for more risky assets driven by expectations of ultra-low rates cannot be realized. In other words, it is unlikely that Ultra-Lave Interest will soon return at any time, which must keep instruments with fixed income attractive to investors.
The 10-year yield has risen in the wake of the Coronavirus pandemic, ending a four-year-old downward downtrend, which began in 1981.
Furthermore, the 50, 100 and 200-month MAs have adapted one over the other. Such a bullish configuration occurred in the late 1950s, marking the beginning of a three-year-old rally in the benchmark yield.
The same can be said for the two -year dividend that tends to be more sensitive to interest rate expectations.
Read more: Crypto Pundits container Bullish Bitcoin Outlook as Fat Rate Cut Hopes Clash with Stagflation Fear
