Bitcoin Clings to $22K as US Dollar Strength Rises to December Levels — What's Next?

The crypto market has been on a tear since Q4 2020. While this has been a great news for crypto enthusiasts and Hodlers alike, it has been nothing but bad news for Bitcoin, as BTC price has been closely following the growth of the US dollar index. This is due to the increasing correlation of bitcoin and the US dollar, which has caused the global asset to drop to December levels, thereby threatening to remove $22,000 as a support line.

In the last few weeks, Bitcoin has dropped to around $22,200; this is only slightly better than the $22,000 mark that served as a support line as recently as December 2020. Now, the question arises, is this the beginning of a long-term bear market, or just an indication of Bitcoin readjusting its trading range? Ultimately, only time will tell but this could be indicative of the US dollar circulating in the market more than ever.

According to analysts, the US dollar index is expected to continue to rise, as investors turn their attention to a strengthening US economy over the coming year. Similarly, Bitcoin faces a lot of uncertainty in the coming months and investors could lie in wait in anticipation of what the future holds.

The crypto market is no stranger to turbulent times, however, based on the trajectory the US dollar is taking against Bitcoin, where do you see the market headed in 2021? Let us know your thoughts in the comments section below.