Dollar Bearish Bets Hit 14-Year High: What It Means for Crypto Markets
The market is more and more turning in opposition to the US greenback, with quick positions at their highest stage since January 2012, based on Bank of America’s international alternate and charges sentiment survey.
This shift in sentiment comes because the US Dollar Index, which tracks the worth of the buck in opposition to a weighted basket of six main currencies, has declined 1.3% yr up to now.
Record Bearish Positioning Reflects Deep Skepticism About the Dollar
The newest Bank of America survey finds greenback positioning in February reached its most unfavourable stage in additional than 14 years. Moreover, general greenback publicity has fallen under the lows of April 2025, signaling continued lack of confidence amongst fund managers.
Despite efforts to revive confidence within the Federal Reserve, skepticism stays. President Trump’s January 2026 nomination of Kevin Warsh as Fed Chair aimed to reassure buyers in US financial coverage. Nevertheless, this transfer has not lifted greenback demand.
“Survey respondents see additional indicators of US labor market weak spot as the primary danger for a decrease greenback,” WSJ reported.
Meanwhile, the bearish sentiment comes amid a substantial slide within the US Dollar Index. In 2025, the index fell 9.4%, with declines persevering with this yr.
On January 27, DXY fell to 95.5, its lowest stage since February 2022. At the time of writing, DXY recovered to achieve 97.08.
DXY at Crossroads as Traders Debate Breakdown Versus Bottom
Market analysts are more and more pointing to technical indicators that time to additional draw back for the US greenback. Trader Donny forecasted that the index may decline under the 96 stage.
“I’m seeing one other bearish leg forming on the DXY,” he wrote.
Other analysts are trying even additional out. The Long Investor highlighted longer-term charts that, in his view, define a a lot deeper structural decline. He steered that bearish targets may lengthen into the 52–60 vary over the 2030s.
However, some analysts see potential for a greenback rebound. The Macro Pulse said latest habits suggests the index could also be getting into a “potential bottoming course of.”
“My base case is a restoration towards 103–104 by July 2026,” the post learn.
Implications for Cryptocurrency Markets
A weaker US greenback usually creates extra supportive circumstances for danger property, together with cryptocurrencies. When the greenback declines, buyers could rotate into various property searching for increased returns or safety in opposition to the depreciation of fiat currencies.
Bitcoin, particularly, is regularly positioned as a hedge in opposition to financial debasement. This can strengthen its enchantment in periods of sustained greenback weak spot.
Still, the connection between greenback weak spot and crypto positive factors isn’t at all times simple. Broader macroeconomic circumstances stay important.
If a softer greenback displays slowing US progress or rising recession dangers, buyers could adopt a defensive stance. In such an atmosphere, capital may movement into conventional secure havens akin to gold somewhat than into more volatile digital assets.
Recent positioning knowledge helps that warning. Bullish bets on gold have increased, signaling that many buyers stay optimistic in regards to the metallic’s prospects.
As the greenback slips and fund managers keep traditionally bearish positions, the approaching months will take a look at whether or not crypto markets can capitalize on shifting foreign money dynamics, or whether or not persistent macro uncertainty will proceed to mood upside momentum in digital property.
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