Renewed bullish behavior in DXY spells trouble for inversely correlated BTC/USD, underscoring the relationship between the two indices.
Bitcoin (BTC) reacted to fresh strength in the U.S. dollar on Sep. 21 to follow stocks downward and move away from $11,000.
Cryptocurrency market daily snapshot, Sept. 7. Source: Coin360
DXY surge spells BTC price weakness
Sunday saw a rejection of resistance at $11,200, with Bitcoin subsequently shedding around 3% on the day as macro markets wobbled at the open. At press time, BTC/USD hovered at just above $10,600.
BTC/USD 1-day price chart. Source: Coin360
As Cointelegraph reported, a basket of factors — coronavirus, central bank economic policy and a separate scandal involving major institutions — is creating uncertainty this week.
The $11,200 rejection was anticipated by Cointelegraph Markets analyst Michaël van de Poppe, who warned that Bitcoin was unlikely to find the strength to flip the previous support level back from resistance.
At the same time, DXY edged past 93 on Monday, with Bitcoin’s corresponding fall characterizing continued inverse correlation.
U.S. dollar currency index 1-week hourly chart. Source: TradingView