Bitcoin bulls are trying to push the price back inside the range, indicating that the markets have rejected the breakdown.
The S&P 500 Index (SPX) plunged 4.25% last week, indicating profit booking by short-term traders near the all-time high of 5,670. Bitcoin
BTC
tickers down
$56,444
was also in the bears’ grip, falling 4.24% as sellers attempted to start a new downtrend.
The recent weakness in risk assets has seen a sharp outflow from the United States-based spot Bitcoin exchange-traded funds (ETFs). Bloomberg data showed $1.2 billion in outflows from the ETFs in eight days.
Global Macro Investor head of macro research Julien Bittel believes that Bitcoin’s current price action is similar to that of 2019. If history repeats itself,
Bittel anticipates that Bitcoin could be nearing an inflection point, where big price moves may begin.
Could Bitcoin rise and maintain above $55,724, signaling that the breakdown was a bear trap? Will that attract buying in altcoins? Let’s analyze the charts to find out.
S&P 500 Index price analysis
The S&P 500 Index is threatening to form a double-top pattern, which will complete on a break and close below 5,119.
The bears pulled the price below the moving averages on Sept. 6, indicating that the bullish momentum has weakened. Sellers will try to sink the price to 5,265.
Buyers are expected to fiercely defend the 5,265 to 5,119 zone. If the price rebounds off this zone, the index may swing inside a large range between 5,119 and 5,670 for a few days.
If buyers want to regain control, they will have to swiftly push the price above the moving averages. The index may then retest the 5,670 resistance. A break above this level will signal the resumption of the uptrend.
US Dollar Index price analysis
The US Dollar Index (DXY) rebounded sharply off the 100.50 level on Sept. 6, indicating that the bulls are aggressively buying the dips.
The recovery will strengthen if buyers kick the price above the 20-day exponential moving average (101.73). The index could then climb to the 50-day simple moving average (103.14).
Such a move will suggest that the index may remain range-bound between 99.57 and 108 for some more time.
On the contrary, if the price turns down sharply from the 20-day EMA, the bears will make one more attempt to sink the index below 100.50. If they succeed, the next stop is likely to be the pivotal support at 99.57.
Bitcoin price analysis
Bitcoin closed below the crucial $55,724 support on Sept. 6, but the bears could not sustain the breakdown, indicating a lack of selling at lower levels.
