Key points:
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The US dollar index (DXY) is below its annual average and below the 200-day equivalent of more than six points.
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Bitcoin should benefit from trends due to its traditional anticorrelation to DXY.
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BTC price action has not followed the historical precedent of the US dollar.
Bitcoin (BTC) As Greenback sets a decade-long record, U.S. debt and dollar weaknesses will benefit.
New research From the OnChain Analytics platform CryptoQuant on Tuesday reiterated the inverse correlation between Bitcoin and the US dollar index (DXY).
BTC price end stacked as DXY sag
BTC’s price intensity continues to gain headwinds from the U.S. dollar against the dollar, which rebounded from its lowest level this month since early 2022.
DXY fell to 96.377 on July 1, and the data came from Cointelegraph Markets Pro and TradingView Showcase – A level not seen in three years, the dollar power yard has dropped by 10% year to date.
But the dubious achievement is not over. CryptoQuant shows that DXY circles an area visited more than 20 years ago compared to its 200-day moving average (MA).
“While U.S. debt reaches new all-time highs, DXY has just reached an all-time weak level, with current trading below its 200-day moving average of 6.5 points, marking the biggest deviation in the past 21 years,” DarkFost summarized Darkfost in a QuickTake blog post.
“Although it may seem shocking at first glance, it actually tends to benefit from risky assets like Bitcoin.”
Bitcoin Periodic Proof Inverse correlation with DXY In its lifespan, but in recent years, this relationship has become Not very clear.
Darkfost believes that this trend remains part of a broader investment model for risk assets.
“As the dollar weakens and loses its safe appeal, investors reevaluate their portfolio allocations and transfer capital to alternative asset classes,” he said.
The accompanying chart shows the relationship between BTC price performance and DXY and 365-day MA.
“The chart illustrates this phenomenon, i.e., periods by highlighting DXY to be below its 365-day moving average,” Darkfost said.
“From historical data, it’s clear that such a period is very beneficial to BTC. We are currently in a stage where DXY weakness can drive a new rise in BTC, but the price has not responded yet.”
Dollars are owned by Bitcoin
As Auxiliary device reportthe weakness of the dollar has accelerated due to the implementation of US trade tariffs.
Related: “Fake Moving” to $105K? 5 Things You Know About Bitcoin This Week
For Bitcoin supporters, it is usually fiat currency Cedification ability To encrypt.
“If the dollar is very strong, that’s the reason to have it,” economist Lyn Alden Tell Cointelegraph Last week it was held at Bitcoin’s “main match”.
“If total credit in the system and total funding in the system continue to increase over the next five, seven, ten years, that is one of the macro factors that make Bitcoin useful.”
https://www.youtube.com/watch?v=5a4uto3qgtu
This article does not contain investment advice or advice. Every investment and trading move involves risks and readers should conduct their own research when making decisions.
