This is a daily technical analysis by Omkar Godbole, a Coindesk analyst and franchised market technician.
Bitcoin
The Bull is optimistic A broader sell-off in the dollar will continue in the second half of the year, exacerbating the crypto bull run.
However, a chart should be cautious when relying on bearish dollar forecasts. That is the weekly chart of the U.S. dollar index, showing as a simple moving average of 50 weeks (SMA) In the short term, it is expected to cross 200 weeks of SMA, forming the infamous death cross.
While the ominous pattern is widely regarded as a long-term bearish signal, it has proven to be a bear trap, always marking the bottom and bullish trend reversal at the dollar price.
The following figure shows that since 2009, DXY has exhausted four weekly chart death crosses, each marking the end of the decline (marked by vertical lines)set a stage for Sharp rally.
The last one happened in January 2021 and was marked around 90. In the following months, the U.S. dollar captured bids, and the index eventually reached more than 114.00 in September 2022.
Note that the price pattern does not always unfold as expected, meaning that the upcoming death crossover may not necessarily be a trap. However, realizing its past trends can help traders manage their positions more effectively.
The U.S. dollar index tracks the value of green to major fiat currencies, which in the first half of the year, was 10.78%, its worst performance since 1991.
