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The US Dollar Index (DXY) fell below 96 for the first time since early 2022, losing the 15-year support line that has anchored the dollar’s strength since 2011.
This major collapse comes amid recent comments from President Donald Trump and a mix of macroeconomic factors. It is worth noting that the recent decline of the DXY index fueled bullish optimism in Bitcoin (BTC).
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The US Dollar Index (DXY) falls to its lowest level in 4 years
Recent macroeconomic developments have put continued pressure on the US Dollar Index. It increased the speculation about it Possibility of yen intervention The Japanese yen, while the American dollar was withdrawn.
At the same time, problems on the stability of the broader market are resurfacing. Second To report From Yorktiv, IMF Executive Director Kristalina Georgieva said at an event hosted by the Bruegel think tank in Brussels that the fund is strengthening its ability to model “unexpected events” and prepare policy responses.
When asked if this included the possibility of an attack on dollar-denominated assets, he said The International Monetary Fund is being examined “All kinds of scenarios” as part of their ongoing analysis.
Finally, recent statements by President Trump have increased the influence of the US dollar. Speaking to reporters in Iowa, he downplayed the recent decline in the US dollar, saying the currency was an “excellent performer.”
“No, I think it’s great … I think the value of the dollar, look at the work we do. The dollar is great,” he said. He said.
Afterwards These comments the DXY recorded the largest one-day decline since the volatility led By definition Customs that was witnessed in April. Market data showed the index fell to a low of 95.5, its weakest level since February 2022, before settling at 96 at press time. decrease Below a key level of long-term support that has been in place since 2011.
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The next three days will be crucial. If the monthly candle closed below the 15-year trend line, expected Analysts also weaken the dollar.
What does a DXY decline mean for Bitcoin?
The inverse relationship between the US dollar and Bitcoin Well established. What stands out in the current movement is this Dips The DXY index below the 96 level has historically preceded significant rises in the Bitcoin market.
Analysts indicate that the last two cases, in 2017 and 2020, were followed by a significant growth of Bitcoin.
Additionally, recent technical analysis highlights bullish signals for Bitcoin. Bitcoin Vector has indicated the development of a bullish divergence between the price of Bitcoin and the relative strength index (RSI), It is a technical pattern that can indicate weak selling pressure.
According to the post, similar arrangements in similar time periods First it led to earnings of approx 10%, indicating a return towards the $95,000 level.
“The real signal is found in the crossover: If we see the simultaneous growth in the fundamentals of the network and liquidity while the emanthiness of Bitcoin remains, we are probably at the beginning of a big bullish reversal,” he said. Post .
However, expected Other analysts saw an additional decline in the largest digital currency. Whether the current market situation turns into a new high for Bitcoin will depend on the confirmation of currency markets and broader risk assets in the coming weeks.
