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Bitcoin prices have retreated to new 2025 lows amid rising U.S. Treasury yields and strengthening Dollar Index (DXY). These developments have prompted crypto analysts to reassess their short-term price expectations.
Second Consecutive Day of Decline in Crypto Markets
The cryptocurrency markets experienced their second consecutive day of decline as the DXY reached new highs and investors expressed concerns about the Federal Reserve‘s monetary policy plans. While the DXY’s initial weakness early in the week briefly pushed Bitcoin to $102,400, the index subsequently reversed course and climbed to 109.
Treasury Yields Rise Amid Inflation Concerns
The increase in U.S. Treasury yields has also negatively impacted the markets. The 10-year Treasury yield rose to 4.7%, while the 30-year yield reached 4.93%. These increases reflect market participants’ concerns that inflation will remain elevated. The new administration’s expansionary economic policies could potentially increase budget deficits, further fueling these concerns and potentially leading to higher interest rates on long-term U.S. debt instruments.
Bitcoin Price and DXY Strengthening
Bitcoin prices have been adversely affected by the strengthening DXY. As of this writing, Bitcoin is trading at $94,000. Analysts caution that if the price breaks below the $90,000 support level, it could face further short-term declines.
Forward-Looking Expectations
Jamie Coutts, Chief Crypto Analyst at Real Vision, suggests that the current DXY strength may be less significant in the long term. Coutts believes that the incoming Trump administration’s potential increase in liquidity and crypto-friendly stance could create positive implications for Bitcoin.
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