Bitcoin price holds steady as British pound hits new low against USD
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(Kitco News) – Global financial markets struggled in the face of a rising US dollar on Monday as the DXY resumed its march higher, peaking at 114,289 and putting pressure on just about every other major currency in existence.
As a result of the strengthening dollar, the major stock market indices drifted into the red within hours of the market opening and remained in negative territory, with the S&P, Dow and Nasdaq closing down 1.03%, 1.11% and 0, respectively. 60%.
Surprisingly to some, Bitcoin (BTC) has managed to maintain its price level despite the appreciation of the USD over the past two days. Data from TradingView shows that despite the continued rise of DXY in recent weeks, BTC continues to trade in an increasingly tight range between $18,500 and $19,750.
BTC/USD 4-hour chart. Source: TradingView
Bitcoin’s relatively muted response to the rising dollar was noted by Kitco senior technical analyst Jim Wyckoff, who noted in his morning update that “BC prices have been calmer amid higher volatility and stronger anxiety in many markets recently.”
As global economic concerns continue to worsen, “BC bulls are hoping the market turmoil will bid for a safe haven in their crypto,” according to Wyckoff, but for now, “the bears have the small overall technical advantage in the near term amid a mild price decline in place on the daily chart.
Further insight into Monday’s price action for BTC and how it has affected derivatives traders was provided by independent market analyst Justin Bennett, who posted the following Tweet highlighting that the next wave of short liquidations will begin if Bitcoin reaches $19,300.
$BTC breaks higher today and retail traders have once again placed their liquidation levels at a key area, in this case $19,600.
Bulk card liquidations start at $19,300. ⌛️#Bitcoin pic.twitter.com/VdXkR5SR43
— Justin Bennett (@JustinBennettFX) 26 September 2022
British pound falls to all-time low
While the rising dollar had little effect on the crypto market on Monday, the same cannot be said for the British pound, which hit a new low against the greenback following the announcement of tax cuts and further debt increases to cushion the effects of a possible economic recession.
On a global scale, the dollar has emerged as the clear currency winner as investors have sought shelter from deteriorating economic conditions.
These developments could also eventually prove beneficial for Bitcoin, which is increasingly seen as an inflation hedge in the face of falling fiat currencies and underperformance of gold.
Crypto investors in the UK have already experienced some protection from BTC as the pound has fallen, with a recent research report commissioned by HM Revenue and Customs indicating that around 10% of UK adults hold crypto assets.
Despite BTC’s negative performance in 2022, Brits holding Bitcoin have seen paper losses of around 53% so far this year, while investors who denominate their holdings in dollars are down just over 62%.
A mixed day for the altcoin market
Overall, it turned out to be a mixed day for the altcoin market as the number of tokens traded in the green was roughly equal to the number traded in the red.
Daily performance in the cryptocurrency market. Source: Coin360
The day’s top performers include Polymath (POLY), which rose 14.3% to $0.25, IOTA (MIOTA), which gained 10.10%, and a 7% gain for Ethereum Name Service (ENS).
The total cryptocurrency market cap is now $934 billion, and Bitcoin’s dominance rate is 39.2%.
Disclaimer: The views expressed in this article are those of the author and may not reflect the views of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is for informational purposes only. It is not an invitation to exchange goods, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept responsibility for any loss and/or damage arising from the use of this publication.
