Bitcoin rallies as US dollar strengthens: Are crypto traders walking into a trap?

Biraajmaan Tamuly 3 minutes ago Bitcoin rallies as US dollar strengthens: Are crypto traders walking into a trap? Bitcoin reclaimed $86,000 as the US dollar strengthened, but one analyst warned the rally may be structurally weak. Listen 0:00 36 Markets News COINTELEGRAPH IN YOUR SOCIAL FEED Bitcoin ( BTC ) held above $86,000 on Monday after recovering steadily over the weekend from Friday’s flush to $80,600, its lowest price since April. The rebound came as traditional markets opened the week on a cautious footing, with the US Dollar Index (DXY) steady above 100, hovering near a six-month high. Key takeaways: The US Dollar Index held 100 after a blowout Nonfarm Payrolls (NFP) print of 119,000 against 53,000. Bitcoin rebounded from $80,600 to above $86,000, but one analyst suggested that it could be deceptive strength. The BTC/gold ratio implied structural underperformance despite the BTC/USD bounce in 2025. Fed uncertainty remains as NFP lifts the US dollar Bitcoin’s move came as global markets digested fresh macroeconomic surprises, starting with the strong US nonfarm payrolls (NFP) report on Nov. 20, which showed 119,000 jobs added versus just 53,000 expected. The hotter-than-forecast NFP injected a fresh layer of tension into the markets’ outlook. Typically, stronger jobs data dampens rate-cut expectations by signaling economic resilience, but this time the impact was mixed: the US Dollar Index (DXY) still held firm above 100, its highest level in six months, while traders recalibrated the Fed’s next steps. On Friday, New York Federal Reserve President John Williams signaled that a near-term rate cut is still possible, arguing that labor-market softness, not inflation, poses the greater risk ahead. However, markets appeared optimistic on Monday, with data from the CME group currently predicting a 78.9% probability of a 0.25% December cut, sharply higher than 44% a week prior. However, Boston Fed President Susan Collins said she remains undecided, highlighting the Fed’s deepening policy divide. Fed Reserve’s interest rate cut expectation for December. Source: CME Group The dollar edged higher against the euro and sterling as European fiscal stress intensified, while the yen surrendered part of Friday’s gains despite fresh verbal intervention from Tokyo. Related: Death cross vs. $96K rebound: 5 things to know in Bitcoin this week Is Bitcoin’s rebound real or just dollar distortion? While Bitcoin’s weekend grind higher has improved short-term sentiment, some analysts caution against misreading the bounce. Market technician Tony Severino noted that BTC’s recent higher high in October against the US dollar may be a “B-wave” rally, amplified by a weakening dollar rather than genuine crypto strength. BTC/GOLD Elliot Wave market cycle analysis. Source: Tony Severino/X Severino’s BTC/gold ratio chart pointed to a cycle peak in March 2025 near 46, followed by a corrective phase bottoming around December 2025 and January 2026, aligning with Bitcoin’s halving cycles. Severion said that the declining ratio implied Bitcoin underperforming gold, meaning BTC/USD upside may be masking structural weakness. Still, Bitcoin’s ability to reclaim the mid-$80,000s amid a firmer dollar offered traders a technical window until volatility and Fed uncertainty settle until the next major move. Related: Bitcoin climb to continue as selling pressure eases: Analysts This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision. # Bitcoin # Cryptocurrencies # Federal Reserve # Dollar # Gold # Bitcoin Price # Investments # Markets # Cryptocurrency Exchange # Interest Rate # Price Analysis # Market Analysis Add reaction