THE RELATIONSHIP OF DXY WITH $BTC
The US Dollar Index (DXY) fell sharply, losing 9% in the three months leading up to April 2025, the second-largest drop since 2011, due to the global trade war led by Trump. #USChinaTensions
- Looking at the 3-month framework shows that each time the US Dollar Index ($DXY) drops significantly (at least 5% in 3 months), #bitcoin ($BTC) tends to rise.
- On average, Bitcoin increases by 43% during these periods, and its price trend usually remains positive (above 0), indicating that this is a favorable time for Bitcoin.
- This information is provided to compare with the current situation (April 2025), when DXY dropped by 9%, but Bitcoin fell by 15%, indicating an anomaly compared to historical patterns. (contrasting the above argument)
- This reflects an inverse relationship: a significant weakening of the dollar (DXY dropping sharply) often leads to a limited price increase response from Bitcoin.
*Conclusion
- The current reaction shows the anomaly of #BTC compared to historical data, which is explained by two arguments:
- Currently, Bitcoin may have a delay compared to DXY, and there may be growth opportunities in the near future (if so, history still makes sense)
- If this time is more unstable and BTC does not follow history anymore, this could be a sign of a larger change in how the cryptocurrency market reacts to macroeconomic factors. Further observation is needed.
- Personally, I am hoping for the first argument that BTC is just lagging behind, but the second argument could also very well happen.
- What do you think?
