Bitcoin is off to upbeat start this trading week

Bitcoin and other cryptocurrencies are performing well in the US equity markets due to robust economic growth and potential annual inflation slowdown. The S&P 500 Index (SPX) increased by 1.06% last week, advancing closer to the psychologically significant mark of 5,000.

Bitcoin rose 2.56% to $43,126, at the time of writing, demonstrating solid buying at lower levels. The Fed will keep rates at its meeting on January 31 but begin reducing them at its meeting on March.

The S&P 500 Index has continued its upward march, with bulls showing strong demand at higher levels. The index is facing resistance at 4,900, but bulls have not ceded ground to bears, suggesting that buyers expect the uptrend to resume. If buyers push the price above 4,907, the index could reach the 5,000 level, where bears may mount a strong defense. The 20-day exponential moving average (4,806) is critical support on the downside, as a slide below this could clear the path for a deeper correction to the 50-day simple moving average (4,694).

The recovery in the U.S. Dollar Index (DXY) faces resistance at the downtrend line, but bulls have not allowed the price to dip below the moving averages. If buyers push and maintain the price above the downtrend line, the index may climb to 104.50 and later to 106. Conversely, if the price turns down from overhead resistance and breaks below the moving averages, bears may defend the downtrend line, potentially slipping to 102.