Bitcoin price analysis: Just as BTC tries to steady, the dollar index wakes up

Bitcoin's recent sell-off has paused, with prices stabilizing between $75,000 and $80,000, but prospects for a sustained recovery are dim due to a resurgent U.S. dollar index (DXY). The DXY has recorded its strongest two-day gain in nine months, rising to 97.60, which is typically bearish for risk assets like BTC because a stronger dollar increases the opportunity cost of holding them and often leads to financial tightening.

This dollar upswing is likely fueled by fears that the incoming Federal Reserve Chair nominee, Kevin Warsh, known as a "policy hawk," will be slow to cut interest rates. Analysts at ING noted that the unwinding of the previous dollar sell-off is linked to Warsh's nomination. Furthermore, upcoming U.S. macroeconomic data, particularly the nonfarm payrolls report, could support the dollar's recovery.

Market strategists suggest the USD bounce has room to run, as Warsh's historical hawkish stance suggests he may advocate less aggressively for rate cuts compared to other potential candidates, reinforcing the dollar's strength against cryptocurrencies.

(Source：CoinDesk)