Coutts concluded that, overall, these metrics paint a negative picture for Bitcoin.“Still, the dollar’s depreciation— one of the largest in 12 years this month — remains the primary driver in my framework,” he added. Related: Bitcoin dips to $80K in ‘ugly start,’ could retest key resistance: HayesOn March 6, Bravos Research said that a declining DXY “could be a major tailwind for risk-on assets,” such as stocks and crypto. Coutts also identified other bullish factors, including a global race for strategic Bitcoin reserves or accumulation via mining, Michael Saylor’s Strategy adding another 100,000 to 200,000 coins to its BTC treasury this year, a potential doubling of spot ETF positions, and increased liquidity. “Think of Bitcoin as a high-stakes game of chicken with the central planners.
Source: Jamie Coutts“With the dollar’s rapid decline in March, one might expect volatility to compress, or if it doesn’t, for the dollar to reverse,” which is bearish, he said. Heightened Treasury volatility can lead to tighter liquidity conditions, which could potentially force central banks to intervene in ways that might ultimately benefit Bitcoin, he suggested. Meanwhile, corporate bond spreads have been widening consistently over three weeks, and major corporate bond spread reversals have historically coincided with Bitcoin price tops, Coutts said.
A weakening US dollar could be bullish for Bitcoin, but two metrics could be cause for concern in the short term, according to Real Vision crypto analyst Jamie Coutts.“While my framework is turning bullish as the dollar plunges, two metrics still raise alarms: Treasury Bond volatility (MOVE Index) and Corporate Bond spreads,” said Coutts in a March 9 post on X.
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Author / Journalist: Cointelegraph by Martin Young
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