Bitcoin Slips to $65k Amid Stronger Dollar, But Analyst Says the Pullback is Over

Bitcoin slipped 5% below $65,000 on Thursday as the U.S. dollar surged amid the Swiss central bank’s interest rate cut. Despite this, some cryptocurrencies like XRP, FIL, and ICP defied the slump, while others like SOL and AVAX declined.

According to Swissblock analyst, Bitcoin completed its correction by rebounding from $60,000 on Wednesday and is now targeting “much higher levels” in the next phase of the uptrend. The cryptocurrency slid lower on Thursday due to a stronger U.S. dollar, giving up some of the gains from Wednesday’s bounce spurred by a dovish tone from the Federal Reserve.

BTC dropped to as low as $64,600 by late afternoon UTC hours from above $68,000 at the start of the day. Altcoins generally outperformed bitcoin during the day, with XRP, FIL, and ICP advancing 6%-7% over the past 24 hours. On the other hand, SOL, AVAX, and APT lost 2%-3% during the same period.

The resurging U.S. dollar, following the Swiss central bank’s surprise interest rate cut, may have contributed to Bitcoin’s weak price action. The move erased all of Wednesday’s steep drop when Fed Chair Jerome Powell struck a dovish tone despite higher-than-expected inflation readings. The U.S. dollar index (DXY), which measures the dollar’s strength against other major currencies, usually weighs on asset prices when it strengthens.

Market participants are now expecting other key central banks to start lowering interest rates before the Federal Reserve, according to macro analyst Michael Kao. Swissblock analysts believe that Bitcoin completed its pullback before Wednesday’s bounce and are now predicting “much higher levels” in the next phase of the uptrend.

Crypto trader Jelle noted that the bottom for the correction is in as long as BTC holds the $65,000 level. He added that Bitcoin could consolidate for a while in the current price range and needs to break above the $69,000 price level – the market cycle peak in 2021 – to reignite its rally to higher prices.

Overall, despite the temporary setback, analysts remain optimistic about Bitcoin’s future performance and expect both altcoins and bitcoin miners to perform “tremendously well” in the next phase of the uptrend.