Bitcoin's Negative Correlation with DXY - Part II
Diupdate
Here's a longer-term look at Bitcoin's negative correlation with the US Dollar Index, in looking at an overlay of the monthly DXY on top of Bitcoin.
CC also displays significant negative correlation, and during the brief periods where it has been positively correlated, that correlation has been insignificant. At least this has been true over the last two major bull runs/corrections and halving cycles.
The two also look like a mirror image of each other, and as mentioned in previous posts - this makes sense. If the dollar is strong, we should expect Bitcoin to weaken, and vice versa.
My previous post about this, here:
The same is true for Gold vs. DXY, as shown below, and for stock markets as well, most of which have been positively correlated with Bitcoin, especially more recently since the 2020 March black swan event. Here are a couple different looks at this:
From the perspective of DXY and its correlation with Bitcoin, Gold, Dow Jones Industrial, and Nasdaq.
And then a look at Gold vs. DXY:
Should DXY move up here, the Bitcoin market and other markets mentioned above may be in for much further and deeper correction. Conversely, should it move down, we could see extended recoveries or even new ATHs as shown in the diagram above. Either way, we should be aware of DXY's movements:
Long-term DXY looks incredibly bullish, with breakout, after re-test, after breakout, after re-test:
Meanwhile Bitcoin could go in either direction as well, and I would imagine it will go in the opposite direction of DXY here, long term. It could first reach 38k to create a new high following DXY's more recent low, and then head back down towards the lower target at 13k should DXY continue up:
Long-term if DXY moves up beyond 112-114 -> 118-120ish, expect blood in the markets.
CC also displays significant negative correlation, and during the brief periods where it has been positively correlated, that correlation has been insignificant. At least this has been true over the last two major bull runs/corrections and halving cycles.
The two also look like a mirror image of each other, and as mentioned in previous posts - this makes sense. If the dollar is strong, we should expect Bitcoin to weaken, and vice versa.
My previous post about this, here:
The same is true for Gold vs. DXY, as shown below, and for stock markets as well, most of which have been positively correlated with Bitcoin, especially more recently since the 2020 March black swan event. Here are a couple different looks at this:
From the perspective of DXY and its correlation with Bitcoin, Gold, Dow Jones Industrial, and Nasdaq.
And then a look at Gold vs. DXY:
Should DXY move up here, the Bitcoin market and other markets mentioned above may be in for much further and deeper correction. Conversely, should it move down, we could see extended recoveries or even new ATHs as shown in the diagram above. Either way, we should be aware of DXY's movements:
Long-term DXY looks incredibly bullish, with breakout, after re-test, after breakout, after re-test:
Meanwhile Bitcoin could go in either direction as well, and I would imagine it will go in the opposite direction of DXY here, long term. It could first reach 38k to create a new high following DXY's more recent low, and then head back down towards the lower target at 13k should DXY continue up:
Long-term if DXY moves up beyond 112-114 -> 118-120ish, expect blood in the markets.
Catatan
Even the daily chart makes this obvious:
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