Bitcoin (BTC) has dropped to its lowest level since February 8 and is struggling to hold onto $40,000. So is it all Elon Musk’s fault?
Cointelegraph took a look at the factors that will give the bulls a hard time this week as the Bitcoin price slumps to levels that are said to be never-ending.
Dollar returned from support
While Tesla CEO Elon Musk’s criticism of Bitcoin’s energy consumption has been the most common topic of discussion lately, there are some other factors that prevent the price rise.
One of these, the dollar, seems to be trying to disrupt the downtrend that started in late March.
The US Dollar Index (DXY), which measures the strength of the dollar against the currencies of other trading partners, reversed the downtrend, turning from a long-term support at the time of translation.
DXY is often inversely correlated with Bitcoin.
Still, DXY closed on Wednesday, the lowest since Jan 6.
Decline in technology stocks
In the macro landscape, it is seen that technology companies are declining. This is generally not a good sign for Bitcoin.
Shares began to come under pressure after Reuters reported that China was tightening its bans on cryptocurrency trading.
China, on the other hand, has not taken a new initiative, and trade associations have just stated that they want to enforce existing restrictions.
MicroStrategy, one of the loser of the stock market, dropped 5.2 percent during the day.
Ironically, Musk’s criticism of Bitcoin also affected Tesla. Tesla lost almost all of his profits on his BTC investment.
For Pyasa, a light may be visible at the end of the tunnel. Crypto markets tend to experience strong rallies following the anxious processes caused by China.
Bitcoin and altcoin prices broke records when the country banned crypto trading in September 2017.
“Find a way to buy at the bottom. Get it somehow,” writes Jason Williams. he explained.
“I’ve seen Bitcoin do this many times before. Its price is falling, news sites are getting cold. FUD (fear, uncertainty, anxiety) is spreading. The price goes down a bit. Then it goes up.”
The number of crypto transferred to exchanges has reached its highest level since March 2020, causing concern among crypto investors.