The dollar 18-month high is the main reason Bitcoin dipped to start the week. Right now, the Dollar Index (DXY) trades near 102.2, up from about 98.8 in early September. Meanwhile, BTC sits around $82.6K as I write. A stronger dollar usually pressures Bitcoin, and Wednesday’s CPI report decides what happens next.
So this post covers three things. First, the macro calendar. Then, the chart levels. Finally, my own trades and the BTC long I’m stalking.
Why the Dollar 18-Month High Matters for Bitcoin
Bitcoin is priced in dollars. Therefore, when the dollar gains value, BTC needs more buying just to stay flat. On top of that, a strong dollar often comes with higher bond yields. As a result, big investors have less reason to hold risky assets.
Several things push the dollar up right now. US yields remain high. Europe is dealing with budget and political tension. Besides that, conflict in the Middle East sends money into safe havens.
However, there is a twist. Bitcoin gained about 6% in September while the DXY rose nearly 2%. In other words, BTC already shrugged off the dollar once. October looks less comfortable, because the dollar now sits even higher.
CPI Week: The Numbers to Watch
Today is Columbus Day in the US. Consequently, the bond market is closed and liquidity is thin. Moves on thin days often fade, so I don’t trust them much.
Wednesday is the real test. The September CPI report lands at 8:30 AM ET. Here is what forecasters expect:
- Monthly headline CPI: +0.6%, up from +0.4%
- Yearly headline CPI: 3.6%, up from 3.4%
- Monthly core CPI: +0.2%, down from +0.3%
- Yearly core CPI: 2.5%, up from 2.4%
Why are CPI days so volatile? Because inflation drives the Fed’s rate decisions. In September, the Fed hiked rates to a range of 3.75% to 4%. That was the first hike since July 2023. Currently, markets price roughly an 83% chance of a hold on October 28.
A hot print would change that fast. Hike odds would jump, the dollar would climb, and Bitcoin would likely sell off. Conversely, a soft print weakens the dollar and gives risk assets room.
This report is tricky, though. Headline inflation should rise while core cools. For that reason, the first move after the release may reverse. I prefer to wait until the dust settles.
Thursday is busy too. PPI, retail sales, jobless claims, and the Philly Fed survey all drop at 8:30 AM ET. Later that night, Fed Chair Kevin Warsh speaks.
Bitcoin Levels: Stuck Between $80K and $87K
The weekly close was decent. In fact, BTC has now closed four straight weeks above its 50-week moving average. That average sits near $77K. Many traders read this as a healthy sign, although the line still slopes down.
Still, the range is clear:
- $84K: first resistance, where a brief push failed
- $87K to $87.4K: the October and September highs
- $80K: support, and last Thursday’s low
- $76K to $78K: deeper support, near the 50-week average
Flows are not helping. Spot Bitcoin ETFs lost $681 million last week, the biggest outflow since late June. Therefore, buyers need to show up before any breakout sticks.
New to reading charts like this? Then start with my market structure guide. It explains higher highs, lower lows, and why they matter.
My Trades This Week
First, a quick update on older calls. Last week I wrote about watching the $81K dip for a long. Price never reached my entry, so I didn’t trade. No entry, no trade. That’s part of the plan too.
My SOL short from the jobs report post is closed as well. The take profits hit first. After that, my trailed stop took me out of the rest.
Here is where I stand now:
- PONS long: stopped out this morning. That’s twice in a row at this spot, so I’ll wait for better structure.
- CATE long: still open.
- NEAR long: opened Saturday morning. Two TPs already hit, and my stop now sits at entry. I booked a nice profit and I’m riding the rest. My target is the $6.5 to $7 range.
The BTC Long I’m Stalking
Honestly, we’re kind of in no man’s land right now. I could see a retest of the low $70Ks. However, I also think a local higher high is possible. Both can be true in a range like this.
So I trade the structure and try not to be biased in any direction. Instead, I just try to get some good trades in between.
My plan:
- Entry: around $81.7K, only with orderflow confirmation
- Stop: around $79K
- TP1: just above $82K
- TP2: $84.5K
- TP3: $87.4K
- Full TP: $90K
Without confirmation, I skip it. That’s exactly what happened last week. Buying dips sounds simple, but it needs rules. For that reason, I wrote a full buy the dip strategy guide.
Trade and Farm at the Same Time
Farming perp DEXes and trading is a good combo. After all, every trade also builds volume toward a possible airdrop. Personally, I’m mostly on Hyperliquid at the moment.
Want more options? Then check our latest edgeX review. Alternatively, compare the field in our best perp DEX ranking.
There is also a new synthetic DEX called PaperTrade. Honestly, though, the first weekend was mostly a whale game to farm $PAPER. Maybe smaller players get a chance later.
Finally, I share my setups in the trading newsletter. Sign up if you want my levels in your inbox.
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Final Words
The dollar 18-month high is a real headwind for Bitcoin this week. Even so, BTC keeps closing above its 50-week average. That tension gets tested on Wednesday, when CPI hits.
Until then, I stay patient. My long only triggers near $81.7K with confirmation. Otherwise, I wait. In a range like this, the trades you skip matter as much as the ones you take.
FAQ
Why does a strong dollar hurt Bitcoin?
Bitcoin is priced in dollars, so a stronger dollar makes it harder for BTC to rise. Additionally, a strong dollar often comes with higher yields, which pull money away from risky assets.
When is the September CPI report?
The report comes out on Wednesday, October 14, at 8:30 AM ET. Forecasters expect headline inflation of 3.6% year over year.
What is Bitcoin’s 50-week moving average?
It is the average of the last 50 weekly closes, roughly one year of trading. Currently, it sits near $77K, and BTC has closed above it four weeks in a row.
Where is Bitcoin support this week?
The first support is $80K, last Thursday’s low. Below that, the $76K to $78K zone lines up with the 50-week average.
Will the Fed hike rates in October?
Markets currently price about an 83% chance of a hold on October 28. However, a hot CPI print could raise hike odds quickly.
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