The latest Bitcoin rally near an all-time high coincided with a recovery of the US dollar against other currencies. The correlation between BTC and the US dollar has been negative in the past 60 days, but this trend may change after the Presidential elections. The DXY index, which reflects the strength of the US dollar, is an important indicator for BTC behavior. In October, BTC saw significant gains, but the US dollar index also rose, suggesting that BTC did not replace fiat currency quickly. The BTC/DXY ratio has remained negative in the past 60 days, but this may shift in the event of a bigger BTC rally. BTC has historically performed well during periods of a weak US dollar and has been tied to positive economic indicators in the longer term. The crypto market may be more easily able to absorb a strong dollar due to its heavy usage of stablecoins. The outcome of the Presidential election is expected to be a major factor affecting both the US dollar and BTC movements, with higher volatility anticipated after the election. The DXY index is expected to peak at the end of 2024 and then decline in the new year. Overall, the index is projected to remain between 101 and 107 for 2025. BTC may benefit from mainstream inflows in the case of US economic optimism, as it becomes more mainstream adopted.



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