A remarkable rebound this weekend has put Bitcoin back en route to $20,000, its record high to date.
But the weekend saw Bitcoin shrugging off a portion of those concerns. The cryptocurrency pushed itself higher after finding concrete support inside the $16,200-16,500 range. It was trading about 15 percent higher from its previous week’s low as of Monday, pointing to another attempt at breaking $19,500 and retest $20,000.
And the fundamentals favor the scenario.
US DOLLAR INDEX HITS APRIL 2018 LOW
The outperformance across the US stock market, with the S&P 500 posting its best month since April 2020, further pointed that portfolios would keep on holding riskier assets through their month-end rebalancing. That could also create a short-term downside pressure on the US dollar.
A weaker dollar favors Bitcoin’s outlook. Its short-term risks create an ideal bullish setup for the cryptocurrency, especially as it adamantly waits for a $20k-retest. Bitcoin’s own fundamentals amid a dovish Fed and booming institutional adoption points to another record high in the making.
BITCOIN THIS WEEK
Guggenheim has net assets of about 4.97 billion, meaning it can now invest close to $500 million in BTC.
“The dollar’s future weakness has been a favorite 2020 talking point for Wall Street economists such as Steve Roach. You can see why. There really are a lot of dollars around, even if their velocity of circulation has slumped because of the pandemic.”
So it appears, Bitcoin’s ascent looks inevitable this week thanks to a weaker dollar sentiment short-term — and long-term, as well.