Decentral Block Post

The United States dollar index (DXY) has started a strong recovery and its rise is putting pressure on Bitcoin (BTC) and the S&P 500 (SPX) index. The market participants will be keenly watching for any insights on future rate hikes when the Federal Reserve Chairman Jerome Powell speaks before the Economic Club of Washington on Feb. 7.

Meanwhile, Bitcoin’s 43% rebound in January has improved sentiment among small investors. Crypto analytics firm Santiment said that the number of Bitcoin addresses holding 0.1 Bitcoin or less soared by 620,000 to hit 39.8 million, the highest level since Nov. 19.

With the sentiment turning positive, traders usually buy the dips as they anticipate the uptrend to continue. However, some analysts believe that the dip buyers will get trapped and Bitcoin may fall to the $19,000 to $21,000 support zone or worse, witness a capitulation in the next few weeks.

Could the S&P 500 and the cryptocurrency markets witness profit booking in the short term? What are the critical support levels to watch out for? Let’s study the charts to find out.

SPX

The S&P 500 index soared above the 4,101 resistance on Feb. 1 but the bears are unlikely to give up without a fight. They will try to pull the price back above 4,101 and trap the aggressive bulls.

Bitcoin (BTC) stayed motionless at the Feb. 6 Wall Street open as analysis showed an “interesting dynamic” in play on BTC price charts.

Bitcoin: Golden cross meets death cross

Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as it ignored the start of United States equities trading to stay near $22,800.

The pair had seen flash volatility into the weekly close, abandoning levels nearer its six-month highs above $24,000.

Bitcoin thus worried market participants as the week began, with an increasing number eyeing a potential retest of $20,000 or lower.

For on-chain monitoring resource Material Indicators, attention now turned to two classic chart features: a “golden cross” on daily timeframes and a “death cross” on weekly timeframes.

Bitcoin (BTC) starts the second week of February in a newly bearish mood as multimonth highs fail to hold.

In what may yet bring vindication to those predicting a major BTC price come down, BTC/USD is back under $23,000 and making lower lows on hourly timeframes.

Feb. 6 trading may not yet be underway in Europe or the United States, but Asian markets are already falling and the U.S. dollar is gaining — potential further hurdles for Bitcoin bulls to overcome.

With some macroeconomic data to come from the Federal Reserve this week, attention is mainly focused on next week’s inflation check in the form of January’s Consumer Price Index (CPI).

In the build-up to this event, the results of which are already hotly contested, volatility may gain a fresh foothold across risk assets.