The US dollar index (DXY) is lower again on Tuesday, trading not far above its 2025 low.
After a strong rally in the weeks following the election of Donald Trump in November 2024, the dollar fell sharply throughout the first half of 2025 and has remained in a choppy pattern near multi-year lows for the past few months.
The dollar’s big fall in 2025 was initially mostly accompanied by expected broader market reaction in things like stocks, gold and bitcoin all rising sharply to new records.
However, the story since October is somewhat different – stocks and other hard assets have continued to rise – indeed, gold, silver and copper all rebounded strongly on Tuesday to hit new record highs – but bitcoin and broader crypto markets have endured brutal bearish moves.
What’s next for the dollar
The DXY index is now trading just above a major long-term support level that stretches back to the global financial crisis of 2008. This level has been tested and held several times, most recently in July and September of this year.
As several foreign central banks, including the Bank of Japan, move toward tighter monetary policy, the U.S. central bank is facing mounting pressure, particularly from President Trump, to cut interest rates. This divergence raises the possibility that the dollar could fall below this major support.
While the weak dollar this year has yet to have any beneficial effect on bitcoin, a break of long-term support might be the news that finally spurs a reversal of the crypto’s downtrend.
