Bitcoin, Ethereum, Dogecoin Trudge Higher As Dollar Index Falls — Why These Trading Levels Are Still 'Dangerous'

Major coins traded in the green at press time as the global cryptocurrency market cap rose 1.2% to $1.85 trillion. 

See Also: How To Buy Bitcoin (BTC)

Why It Matters: Bitcoin touched an intraday high of $39,137.95 on Tuesday. Pseudonymous cryptocurrency analyst Kaleo pointed out that until these highs are reclaimed, the apex cryptocurrency remains at “dangerous levels.”

The greenback was muted on Tuesday as the Federal Reserve downplayed the chance of a half percent rate hike next month. The dollar index, a measure of the U.S. unit’s strength against six of its peers, fell to 96.272, according to a Reuters report.

Cryptocurrency trader Michaël van de Poppe pointed to the weakness of the dollar and said that’s the “only reason that Bitcoin is showing some strength.”

“Bitcoin will continue to trade like a risky asset and most likely benefit if central banks continue to show some hesitancy in turning very aggressive with tightening monetary policy,” said OANDA Senior Market Analyst Edward Moya, in an emailed note.

Moya said the Bank of England and European Central Bank rate decisions might have a larger impact on cryptocurrencies than normal as Wall Street is looking for a cue on the direction where rates are headed.

“Bitcoin should continue to stabilize here but if it breaks $40,000, that would surprise many traders and could see some bullish momentum.”

Meanwhile, the number of addresses holding 1+ ETH has reached an all-time high of 1,415,350, according to Glassnode data.

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Photo: Jose Rodrigo Safdiye/Benzinga