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Bitcoin price may get crushed further as the world’s reserve currency U.S. dollar may be bottoming

Bitcoin price has been under pressure for the past three days after peaking at $ 12,500 earlier this week. Some argue that there appears to be a clear inverse correlation between the value of the as calculated by the Dollar Index and Bitcoin.

Bitcoin price may get crushed further as analysts have noted that the world’s reserve currency may be bottoming

As the dollar moved higher, the value of Bitcoin (and gold for that matter) fell. The drop to $ 11,500, where BTC traded as this article writes, appears to be driven by a slightly higher value of the US dollar. However, Bitcoin could be crushed even more as the dollar may be bottoming out. The US dollar is likely to find a bottom after falling from a March high, fueled by a rush of liquidity as a pandemic begins to spread.

This happened after the USD was profoundly affected by the stimulus measures worth trillions of dollars by the US Government and the Federal Reserve.

Crypto trader Mayne shared the chart below, which shows that the Dollar Index may be forming a bottom pattern. This does not bode well for bullish cases for Bitcoin, Ethereum, gold, and silver:

“$ DXY finally finding support? Keep an eye on this chart, if we regain that top-level expects $ BTC, $ ETH, $ Gold, and $ Silver to fall further.”

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Market commentator Coiner-Yadox notes that the dollar’s recent price action is oddly reminiscent of a bottom formation pattern – a trend that could stop BTC:

“Could be a bottoming formation for the dollar, which would be bad for $ BTC. I’m personally taken a lot of profits, and I’m waiting for a bit to see what happens. ”

While the US Dollar may start to appreciate in the near term, this could change if the US government launches another stimulus package. Analysts say that the main driving force holding the dollar in recent months has been the trillions of dollars spent on stimulus packages.

What could also hurt the US dollar is the uncertainty surrounding the presidential election just a few months away. Each candidate may have policies that put the value of money in question.

If the US dollar continues to fall in value, Bitcoin will continue to rise higher as investors search for their stock of wealth.

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