The dollar fails another attempt to break upward

Source: Criptonoticias Original Title: The dollar fails new attempt to break upwards Original Link: The dollar index (DXY) has once again retreated after attempting, unsuccessfully, to break the resistance zone located between 100 and 101 points, a level that has contained its advances over the past seven months.

According to the graph below, the DXY has shown a lack of momentum and consistent pullbacks after testing the resistance (shaded red rectangle). Notably, considering that this index measures the strength of the greenback against the euro, the yen, the pound, the Canadian dollar, the Swedish krona, and the Swiss franc.

The resistance between 100 and 101 points has not been broken.

This bearish behavior is partly due to the optimistic expectation of rate cuts by the Federal Reserve (FED) of the United States in December, as well as mixed macroeconomic indicators that have reduced demand for dollar-denominated assets.

A weaker dollar tends to strengthen the appetite for risk, which has historically benefited bitcoin and other cryptocurrencies. When the US currency loses global strength, investors often rotate towards alternative instruments that offer appreciation potential.

This is because a depreciated dollar lowers the entry to risky markets. Furthermore, it pushes traders to seek returns outside of traditional fixed-income assets or cash itself.

If the weakness of the DXY continues, a greater flow towards bitcoin is possible. Especially in a context where markets anticipate more flexible financial conditions heading into 2025.