Odaily, citing CoinDesk, reported that Bitcoin, often described in the market as a counterpart to the U.S. Dollar Index (DXY), is facing continued pressure as the dollar strengthens. Data cited in the report showed that Bitcoin weakened for a third consecutive trading day, with its price hovering near $63,900. The broader crypto market was also broadly under pressure as traders focused on whether DXY would break above the upper boundary of a consolidation range that has lasted for 13 months.
DXY rises to 100.66 and approaches a key range boundary
The U.S. Dollar Index advanced 0.26% to 100.66, extending a 0.8% gain from the previous trading day. The index is now close to the edge of what the report described as a key range breakout. The analysis noted that if such a structural breakout is confirmed, trend-following capital typically adds further upward momentum to the dollar, reinforcing the strength of the currency’s move.
The rise in DXY is placing direct pressure on Bitcoin. Historical data cited in the report showed a clear negative correlation between Bitcoin and the U.S. Dollar Index. When the dollar strengthens, risk assets priced in U.S. dollars usually face pressure, and crypto assets are included in that group. Bitcoin’s latest decline has taken place alongside the continued advance in DXY, keeping the inverse relationship between the two assets in focus.
Fed’s hawkish tone reinforces support for the dollar
The report also said the market views the Federal Reserve’s hawkish comments as reinforcing the logic behind dollar strength. That backdrop has encouraged capital to lean toward safe-haven assets and dollar-denominated assets. In this environment, Bitcoin, as a risk asset, remains sensitive to changes in the dollar index. With BTC trading near $63,900 and DXY standing at 100.66, the opposite movement of the two markets has become a key reference point for assessing pressure across the crypto market.