Amidst the tariffs initiated by new U.S. President Donald Trump, and counter-tariffs from Canada, Mexico, and China, Bitcoin suffered quite a fall in price. However, the fight-back looks to have begun, and bulls are pushing to retake lost ground.
S&P 500 falls out of ascending channel
Source: TradingView
The S&P 500 has taken quite a blow from the ongoing tariff wars. The ascending channel, in place since early 2023, is in danger of failing. The price has dropped out of the channel and has tagged the 200 SMA.
The only other times the price dropped out of the channel was in October 2023 due to concerns over government funding and higher interest rates, and then in August 2024 for the Japanese stock market crash.
U.S. Dollar Index (DXY) continues to fall
Source: TradingView
Very good news is that the U.S. Dollar Index (DXY) is falling. As can be seen in the chart above, the DXY rejected from the major descending trendline. This all corresponds with U.S. Treasury Secretary Scott Bessent’s statement that the Trump administration wants a weaker dollar, which is likely to have the effect of lifting risk assets higher.
$BTC makes a short-term higher low
Source: TradingView
Looking at the short-term chart for $BTC, the main takeaway is that the price is still rolling over. A series of lower highs has yet to be challenged. That said, a recent higher low has just been set. It now remains to be seen whether the price gets rejected from the bottom of the wedge, or if the bulls can push the price back above. $95,200 is where the bulls would make a higher high, while the top of the wedge and a potential breakout would also be around this level.
If the price is rejected from the bottom of the wedge, or even from the major ascending trendline, the bulls would need to avoid a lower low in the next correction, which if made, could take $BTC all the way down to $73,000.
Bottom signalled on daily RSI?
Source: TradingView
Zooming out into the daily time frame some interesting developments can be seen. At the bottom of the chart, first the Stochastic RSI, shows that the indicator lines broke up beyond the descending trendline. This makes a higher high, and if the indicator lines can bounce from the trendline, this sends momentum back under the price, pushing it higher.
At the very bottom of the chart, the Relative Strength Index shows an unbroken trendline from November 2024. It can be seen that the indicator line came as low as 24.20. This is the lowest point reached on the daily since August 2023, and therefore might well signal a bottom.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.