Bitcoin (BTC) is back above $37,000 on February 3 after falling stocks undermined the bull’s latest attempt to break the $40,000 resistance.
Hourly candlestick chart BTC/USD (bit stamp). Source: Trading View
“Unusual features” of the stock
Data from Cointelegraph Markets Pro and TradingView showed that BTC/USD remains lower after hitting $36,650 on Bitstamp on Wednesday.
The weakness followed sudden losses in US stocks at the Wall Street open on Wednesday, as big companies such as PayPal lost much of their value after disappointing earnings reports.
Meta followed hours later, shedding 20% of the stock’s value after data emerged that showed it was losing first-time users.
While bitcoin proponents were quick to mock the events, disappointing price action meant that the area identified as a reversal of major resistance/support looked less likely.
“If Bitcoin loses this level at $37,000, I think it will start to drop quickly towards the lower end of the area around $34-35K,” Cointelegraph employee Michael van de Poppe said the day before.
Van de Poppe added that in the future, the strength of the US dollar could be the key to understanding the upcoming movements in the cryptocurrency markets in general. The US Dollar Index (DXY), to which the cryptocurrency is inversely correlated, has lost a lot in recent days.
“What we see in the cryptocurrency markets really depends on DXY,” he told his Twitter followers.
“If DXY reverses into a downtrend in the coming weeks, this should be a significant increase in bitcoin’s bullish momentum.”
The US Dollar Currency Index (DXY) chart is a one-day candlestick chart. Source: Trading View
Altcoins Are Compensating Bitcoins Losses
Meanwhile, altcoins added to their intraday losses, with the top 10 cryptocurrencies led by Solana (SOL) dropping nearly 10%.
Related: Price Analysis 2/2: BTC, ETH, BNB, ADA, SOL, XRP, LUNA, DOGE, DOT, AVAX
A number of issues with the platform contributed to the price drop, with SOL/USD trading below $100 at the time of writing.
SOL/USD (FTX) hourly candlestick chart. Source: Trading View
Other weak players include Polkadot (DOT) and Terra (LUNA), while Ether (ETH) is down 3.4% on the day.