The co-founders of Glassnode, Jan Happel and Yann Allemann (Negentropic), predict that Bitcoin could soon reach new all-time highs.
They believe this potential surge is tied to the weakening US Dollar Index (DXY), which may occur due to the Federal Reserve’s rate cuts and quantitative easing (QE). The DXY, which measures the dollar’s strength against six major currencies, typically signals that a weaker dollar boosts risk assets like Bitcoin and stocks.
Bitcoin & DXY: A Tight Dance 🪙📈
Bitcoin has closely tracked the DXY for weeks, especially post-US elections, as the dollar hit new yearly highs. But with easing policies in play, what happens when the DXY weakens and decoupling starts?
Signs point to Bitcoin smashing new ATHs… pic.twitter.com/0NEdcOMAuj
— 𝗡𝗲𝗴𝗲𝗻𝘁𝗿𝗼𝗽𝗶𝗰 (@Negentropic_) November 15, 2024
Bitcoin has closely tracked the DXY in recent weeks, especially after the US elections, but with the Fed’s easing policies, the analysts foresee Bitcoin breaking past its previous highs if the DXY weakens. At the time of writing, Bitcoin is priced at $89,200, down 5% from its peak of $93,500.
On the Ethereum front, despite its decline relative to Bitcoin (ETH/BTC), its market cap has shown strength. Ethereum’s market cap rose from $290 billion to over $400 billion during Bitcoin’s rally, dipping only slightly to $380 billion during the ETH/BTC pullback.
This indicates that Ethereum holders aren’t selling off, and Bitcoin’s dominance is currently outshining other market forces. Bitcoin’s dominance is at 61% as of now.
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Taking a look at Ethereum’s market cap:
👉🏻 after “Super Tuesday,” it rose from $290B to just over $400B. During this ETH/BTC pullback and BTC dominance surge, ETH’s market cap only dipped to $380B.This suggests no dumping, just Bitcoin’s strength outshining other… pic.twitter.com/uFm3RBPmHI
— 𝗡𝗲𝗴𝗲𝗻𝘁𝗿𝗼𝗽𝗶𝗰 (@Negentropic_) November 14, 2024
As Bitcoin pushed past $111,000 on May 22, breaking its previous all-time high, activity in the futures market erupted in response.
Fifteen years ago, a programmer unknowingly made history when he traded 10,000 bitcoins for two pizzas—marking the first documented purchase using cryptocurrency.
Strategy, the rebranded identity of MicroStrategy, is preparing to raise up to $2.1 billion through the sale of preferred stock as part of its ongoing effort to grow its Bitcoin portfolio.
Bitcoin’s return to six-figure territory has reignited market optimism, but unlike the short-lived surge seen in January, the current rally appears to be built on firmer ground.