Anatomy of bitcoin's plunge this week: The dollar's bottom was BTC's top
Analysis
Price Impact
HighBitcoin experienced a significant plunge from nearly $91,000 to $81,000 this week, directly correlated with the strengthening of the u.s. dollar (dxy). this was driven by the fed's decision to hold rates steady and the hawkish nomination of kevin warsh as fed chairman.
Trustworthiness
HighCoindesk is a highly reputable source for crypto news and market analysis. the article provides a clear, detailed, and logical explanation linking macroeconomic factors (fed policy, dxy, fed chair nomination) to bitcoin's price movement.
Price Direction
BearishThe immediate price action showed a sharp decline, and although there was a slight bounce, the continued strengthening of the dollar suggests ongoing downward pressure and questions the sustainability of any recovery for btc in the short term. the inverse correlation to dxy is a key factor.
Time Effect
ShortThe 'plunge this week' and the described events (fed announcement, nomination leak) all happened within a short timeframe, and the 'questions about how sustainable the crypto's rise might be' refer to immediate future price action.
Original Article:
Article Content:
Markets Share Share this article Copy link X icon X (Twitter) LinkedIn Facebook Email Anatomy of bitcoin's plunge this week: The dollar's bottom was BTC's top It seems like ages ago, but bitcoin rose to just shy of $91,000 on Wednesday. Then the U.S. dollar started to strengthen. By James Van Straten | Edited by Stephen Alpher Updated Jan 30, 2026, 8:32 p.m. Published Jan 30, 2026, 6:57 p.m. Make us preferred on Google Bitcoin fell this week as the dollar rose (CoinDesk) What to know : Bitcoin was actually posting gains this week as the U.S. dollar fell through a key technical level. That ended on Wednesday afternoon, though, as the Fed stood pat on policy and speculation about who the next Fed chair might be amped higher. The Thursday night leak of the nomination of Kevin Warsh caused a spike in the dollar and a fast decline in bitcoin. Bitcoin’s BTC $ 83,897.82 sell-off late this week might have had little to do with crypto-specific factors and instead everything to do with the U.S. dollar. After what’s now becoming a customary weekend decline in crypto prices, bitcoin was actually on the rise through the week, in part as the decline in the U.S. dollar accelerated. STORY CONTINUES BELOW Don't miss another story. Subscribe to the Crypto Daybook Americas Newsletter today . See all newsletters Sign me up By signing up, you will receive emails about CoinDesk products and you agree to our terms & conditions and privacy policy . Bitcoin peaked for the week late Wednesday afternoon, just shy of $91,000, as the Fed held rates steady and attention turned to who President Trump might nominate as the next leader of the U.S. central bank. The peak coincided with a decline in the dollar index (DXY) to a multi-year low of 95.34. All other things being equal, a weaker U.S. dollar is often seen as supportive of asset prices, such as bitcoin, stocks, and commodities. Even though technicians sounded the alarm that the DXY below 96 meant even deeper declines for the greenback, markets thought otherwise. The dollar began a steady climb, and, alongside, bitcoin began pulling back from that $91,000 level. The dollar continued strengthening into Thursday, with bitcoin's losses accelerating throughout the session. Finally, the Thursday evening leak that Kevin Warsh (and his hawkish reputation) was to be nominated as Fed chairman forced another surge higher in the dollar and gap lower in bitcoin, with BTC ultimately bottoming at $81,000. Bitcoin's managed to bounce to $83,000 since then, but the dollar has continued to post gains, raising questions about how sustainable the crypto's rise might be. US Dollar Bitcoin News Federal Reserve In this article BTC BTC $ 83,897.82 ◢ 0.28 %