Recently, Twitter user Benjamin Cowen, a crypto analyst, signalled significant repercussions for the cryptocurrency market by sharing an unexpected observation. The U.S. Dollar Index (DXY) has created a golden cross on its chart, which is a technical pattern frequently connected to a big upswing, according to Cowen.
On the price chart of an asset, a golden cross happens when a short-term moving average crosses over a long-term moving average. Cowen’s remark raises the possibility that the U.S. dollar is about to see a significant strengthening, which might have an impact on the wider financial environment, including cryptocurrencies.
https://x.com/intocryptoverse/status/1704679434303713349?s=20
Cowen asserts that when the U.S. dollar gains strength, it can draw capital away from other markets, such as the cryptocurrency market. Before such a change fully takes place, he also expects a slight fall in the dollar index, which may cause a brief increase in cryptocurrency prices.
Dominance issues
The possible impact on alternative coins like Shiba Inu (SHIB) and Cardano (ADA) is one significant factor uncovered by Cowen’s investigation. Even during this period of adjustment, according to Cowen, Bitcoin’s influence on the cryptocurrency market is expected to increase, thereby concentrating liquidity in Bitcoin and making altcoins susceptible.
Cowen has previously raised worries about the cryptocurrency sector. He first made a downward prediction in September, noting a significant drop in liquidity. Cowen anticipates that this trend will continue up to the probable implementation of quantitative easing measures in accordance with U.S. Federal Reserve policy, which he estimates won’t happen until sometime in the summer of 2024.
