The dollar has reached new highs over the past 18 months, causing a ripple effect across the entire financial market. Recently the U.S. Dollar Index (DXY) surpassed 102.5, while the Fed’s rate‑hike and the rise in Treasury yields have been moving in tandem during the same period. This economic trend has increased the burden on risk‑assets such as Bitcoin.
Even after the DXY broke through 102.5, a support level at $85,000 is believed to provide some stability for Bitcoin’s price. In the past, when the dollar was at 99 levels, it rose about 3 % and this trend has moved above the 200‑day moving average while signalling long‑term strength. If the Fed raises rates again, the equity market and Treasury yields become relatively attractive, which increases the burden on risk assets.
The Fed raised its policy rate by 0.25 percentage point in September to a range of 3.75–4.00 %. The market has already priced in further tightening potential. By June 2027, the policy rate could reach about 4.50–4.75 %, which is consistent with the inflationary outlook and the U.S. government’s expansion of borrowing that triggers higher Treasury yields.
In Europe, political‑economic uncertainty is cited as a major reason for the rise in the dollar index. The euro accounts for 57.6 % of the dollar index, so when the exchange rate falls the dollar tends to rise relative to it. Recently the euro‑dollar rate fell to about $1.12, marking its lowest level in 17 months. France and Spain are pressuring investor sentiment with political‑economic uncertainty.
Bitcoin has shown a relatively stable trend despite the dollar’s strength and Treasury yield rise because Bitcoin does not pay interest; as Treasury yields rise, relative attractiveness of investments may decline. Therefore if the dollar and treasury remain at high levels simultaneously, liquidity in risk assets will be constrained and Bitcoin is expected to hold its $85,000 support while maintaining a stable position.