Analysts comparing Bitcoin’s historical performance to the U.S. Dollar Index (DXY) suggest that it is at the edge of a new bearish phase.
TradingShot, a leading market research group, noted that the dollar has been forming higher lows since July. This pattern often signals the start of a new bull cycle for the greenback. Historically, such moments have coincided with Bitcoin peaks and the beginning of downturns in its price cycles.
In a cross-asset comparison, the firm explained that Bitcoin and the dollar have negatively correlated for over 15 years. Each time the DXY bottoms and rebounds, Bitcoin tends to lose momentum.
Current technical readings suggest the dollar may have reached a multi-year bottom, strengthening the case that Bitcoin’s sideways movement and recent pullbacks could mark the onset of a new bear cycle.
Recent market data also support the cautious outlook. According to CoinMarketCap, Bitcoin has slipped 11.8% over the past nine days, falling from an all-time high of $125,800 to around $112,090.
The drop coincided with geopolitical tensions following former U.S. President Donald Trump’s tariff comments on China, initially triggering a market sell-off. Though he later reversed his stance, uncertainty still weighs on risk assets.
Meanwhile, Whale activity has picked up sharply. Over 51,000 BTC were moved into exchanges last week, which has been the largest weekly inflow since November 2024. Market analysts say the surge could point to major holders preparing to offload positions as technical indicators turn increasingly bearish.
Investor sentiment has also soured. The Crypto Fear & Greed Index has dropped to 28 due to traders becoming more cautious.
Some analysts believe a short-term relief rally could emerge if buyers defend the $104,500 support level. However, they warn that Bitcoin’s downside risks are high without renewed ETF inflows and stronger institutional demand. That setup could mark the early stages of a new bearish cycle.
Source: https://zycrypto.com/this-metric-suggests-bitcoin-may-be-entering-last-bear-cycle-of-the-year/
