Closely followed crypto analysts say a weakening US dollar will lead to a massive rally in digital assets in the near future.
Glassnode co-founders Jan Happel and Yann Allemann, who share the Negentropic handle on the social media platform participation that the dollar index (DXY) is nearing the end of a recovery that will ultimately lead to a major decline.
The DXY compares the US dollar against a basket of other major foreign currencies and is often used to gauge the strength of risky assets.
Using the Elliot Wave Theory, which suggests that price corrections occur in three major waves, the analysts say DXY is about to end its second wave – an upward momentum – before falling to new local lows, leaving crypto and other risky assets are boosted.
“EVERYTHING revolves around DXY.
Strong DXY -> battle against risky assets.
Weak DXY -> risky assets rise.
DXY summit was in October 2023. First leg until end of December 2023.
In 2024, DXY is bouncing.
We believe this was a wave 2 bounce – and it’s DONE!
Now – DXY is about to begin [its] reject. Therefore, risk assets should rise.
We believe this will be the catalyst for a crypto blow-off summit.”
Happel and Allemann recently called for Bitcoin (BTC) to go parabolic after printing a similar correction pattern as in the previous two bull markets. Using Fibonacci extensions, the analysts predict a $120,000 price tag for BTC sometime around July this year, much earlier than what most analysts currently expect.
“BTC has moved to the 6.618 Fibonacci extension after a bullflag correction. Currently we are in a small correction, like at the end of 2017 and the end of 2020.
Will history rhyme in 2024 – and will BTC go to its 6.618 Fib extension in this bull market? That would give us a target amount of ~$120,000. Time will tell!”
At the time of writing, Bitcoin is trading at $43,302.
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Generated image: Midjourney