Bitcoin’s Potential Breakout

Real Vision’s chief digital assets analyst Jamie Coutts believes Bitcoin (BTC) is gearing up for a massive breakout after weeks of volatility.

Coutts tells his 35,600 followers on the social media platform X that he thinks a weakening US dollar and a massive sell-off in the crypto markets sets Bitcoin up for a bullish reversal by May, when it may print new all-time highs.

According to the Real Vision analyst, the strength or weakness of the US dollar as measured by the US Dollar Index (DXY), a benchmark of the value of the US dollar compared to a basket of six major currencies, determines Bitcoin’s price direction.

When the DXY is strong, it is often seen as a sign that the US economy is strong and that the US dollar is a safe haven asset. This can lead to selling pressure in cryptocurrencies, as investors move their money into the US dollar.

> “This week had it all. The DXY saw its fourth largest negative three-day move – massively liquidity-positive. Just as Bitcoin nuked and had its worst February in a decade. Meanwhile, in altcoin land, the Top 200 crypto index puked one more time. The chart shows that 365 days of new lows hit 47%, a hallmark of capitulation in a bull cycle. The stage is set for a new all-time high in Bitcoin and Top 200 aggregate market cap by May.”

Source: Jamie Coutts/X

He suggests that a bottom may now be forming in the altcoin market after the major selloff that could lead to some alts having explosive rallies to new all-time highs (ATHs).

> “I expect some alts to make new ATHs this cycle.”

He also shares a chart showing that the three previous times the DXY fell by a similar percentage change Bitcoin went on explosive rallies.

> “Don’t think people understand the significance of the DXY move in the past three days and what it means for Bitcoin.”

Source: Jamie Coutts/X

The DXY is currently at 104 while Bitcoin is trading for $88,787 at time of writing, down 1.2% in the last 24 hours.