bitcoin has surpassed the critical 200-day simple moving average of $109,380, indicating potential weakness ahead as the Dollar Index (DXY) continues to gain momentum.
The breakdown may trigger more selling by chart-focused traders, which could push bitcoin towards $100,000 or lower. The dollar index, which measures the U.S. dollar against major fiat currencies, rose to 99.72, its highest level since Aug. 1, boosted by hawkish comments from Federal Reserve Chair Jerome Powell downplaying a rate hike in December and the Bank of Japan’s very dovish stance, which weakened the yen.
Interestingly, bitcoin’s decline comes despite a positive development in trade relations between the United States and China. President Donald Trump and Chinese President Xi Jinping reached an early deal to reduce tariffs (reducing US tariffs on Chinese goods from 57% to 47%) and boost trade. The agreement also includes Beijing’s commitment to secure supplies of rare earths, buy American soybeans and crack down on fentanyl trafficking. However, this positive result failed to spark a rally in cryptocurrencies, suggesting underlying weakness in demand.
Other cryptocurrencies are also under pressure: looked poised to confirm a “death cross” with its 50-day and 200-day simple moving averages in the coming days, while solana weakened despite strong initial acceptance of Bitwise’s SOL spot ETF.
