Is Bitcoin headed for $100k? What it could mean for US dollar.

Data current as of 3/4/2024

Key points

• Bitcoin tops $66,000, 70k next?: (0:46)
• US Dollar still strong vs the yen: (3:23)
• Big moves in BTC, USD weakness?: (4:41)
• Bitcoin uncorrelated to other assets: (5:52)
• Interest rates holding in above 4%: (7:34)

Bitcoin tops $66,000, 70k next?

Bitcoin has crossed the $66,000 threshold, nearing its all-time high of just below $70,000. This movement prompts speculation about reaching or surpassing the $70,000 mark soon. The recent price increase signals strong investor confidence and a bullish outlook in the cryptocurrency sector. Bitcoin has posted an impressive 2024 so far - started the year below $45,000.

US Dollar still strong vs the yen

US dollar continues to pin the yen near historic extremes above 150.00. Despite fluctuations in the global financial landscape, the US dollar has maintained its stronghold against the Japanese yen, consistently trading above the 150.00 threshold. This sustained strength situates the dollar near historical highs against the yen, reflecting a robust US economic outlook relative to Japan's, as well as differing monetary policies between the Federal Reserve and the Bank of Japan.

Big moves in BTC, USD weakness?

Historically, Bitcoin rallies often coincide with US dollar weakness, and vice versa. Recent trends, however, show an intriguing development: significant upward movements in Bitcoin's value at a time when the US dollar remains markedly robust against several major currencies. This divergence paints a complex picture of the financial markets, where traditional correlations are challenged, and new patterns emerge, underscoring the multifaceted influences that drive currency and crypto dynamics.

Bitcoin uncorrelated to other assets

Over the last three months, Bitcoin prices have moved relatively independent of USD, stocks, and gold. This decoupling marks a significant departure from historical trends, where Bitcoin's valuation often reacted to shifts in traditional financial assets. The cryptocurrency's recent trajectory may suggest a maturing market, where Bitcoin begins to carve its own path, unaffected by the traditional financial market's rallies or downturns.

Interest rates holding in above 4%

10-year treasury yields have bounced back to start the week, remaining well above 4% during Bitcoin’s rally. This resilience in interest rates, amid surging Bitcoin prices, offers a fascinating glimpse into the concurrent strength observed in both cryptocurrency and more traditional investment avenues. As yields on 10-year treasuries maintain their ground, the correlation—or lack thereof—between interest rates and Bitcoin's performance continues to be a subject of analysis and debate amongst traders and economists alike.

How to trade US dollar

1. Open an account to get started, or practice on a demo account
2. Choose your forex trading platform
3. Open, monitor, and close positions on USD pairs

Trading forex requires an account with a forex broker like IG. Many traders watch major forex pairs like GBP/USD and USD/JPY for potential opportunities based on economic events such as inflation releases or interest rate decisions. Economic events can produce more volatility for forex pairs, which can mean greater potential profits and losses as risks can increase at these times.

You can help develop your forex trading strategies using resources like IG’s YouTube channel. Our curated playlists can help you stay up to date on current markets and understanding key terms. Once your strategy is developed, you can follow the above steps to opening an account and getting started trading forex.

Your profit or loss is calculated according to your full position size. Leverage will magnify both your profits and losses. It’s important to manage your risks carefully as losses can exceed your deposit. Ensure you understand the risks and benefits associated with trading leveraged products before you start trading with them. Trade using money you’re comfortable losing.