The price of BTC could once again become inversely correlated with the dollar, so much so that the famous co-founder of MicroStrategy, Michael Saylor, has made a decidedly bull prediction.
From the moment of Donald Trump’s victory in the US presidential elections on November 5, the trend of Bitcoin’s price has temporarily abandoned the inverse correlation with the Dollar Index, but in the medium term, it could recover it.
Saylor’s forecast on Bitcoin (BTC) and dollar
Yesterday Michael Saylor gave an interview to CNBC in which he talked about Bitcoin.
His was a double forecast on the price of BTC, because he expressed himself on both the bull and bear highs and lows by the end of the year.
Regarding the lows, he said that he does not think it will reach $60,000, and that from here on it will rise further.
He stated it because other analysts predict a drop even below 60,000$.
To tell the truth, many analysts argue that $82,000 should hold, but there are also those who are more optimistic. However, the other figure circulating is $75,000, which it had reached on the day of Trump’s victory, while $60,000 is really a level that few indicate as likely.
The other prediction by Sailor concerns the highs.
He stated that he is organizing a party for New Year’s Eve at his house during which the $100,000 price of BTC will be celebrated, and that he would therefore be surprised if this figure does not arrive in November or December.
The fateful $100k
It has now been more than three years since the hypothesis has been circulating that the price of Bitcoin could even exceed the psychological threshold of $100,000, and the day before yesterday a significant step was made in this direction, reaching over $93,400.
However, Saylor does not seem to refer to the 100k as a temporary maximum peak, but as a price level that could also be maintained.
To tell the truth, however, the price of BTC remains so volatile that it is unlikely to stop there once it reaches $100,000.
It could, for example, surpass them with momentum, and perhaps even reach up to $110,000, only to retrace afterwards. Or it could touch them for a brief moment and then correct immediately after.
The real point of the matter is not whether the 100k will be reached sooner or later, as this seems quite likely at this stage, but if Bitcoin will subsequently be able to stay above this psychological threshold. It could also fall back below, but in the medium term, in theory, it should have the strength to climb back above.
Saylor’s prediction: the correlation between Bitcoin (BTC) and the dollar
The reason for the rise in the last two weeks is the victory of Trump in the US presidential elections, or the so-called “Trump Trade“.
This dynamic is now running out, even though it might have one last tail end from here to Monday.
What will happen next, on the other hand, is a whole different thing, but there is at least one point that seems easy to predict.
The fact is that historically the dollar has always weakened in the year following the USA presidential elections.
Furthermore, from the end of September to today, the Dollar Index has risen from 100 points to yesterday’s annual peak of 107 points.
Note that yesterday’s peak was even greater than the maximum peak of 2023, and this suggests that all conditions are in place for its decline.
In case of a long decline of the dollar, Bitcoin could react with a long rise.
The decline of the dollar
In the year following the two previous USA presidential elections (those of 2016 and 2020), the Dollar Index fell in both cases to 90 points.
Although it may not seem like much, for an index like the Dollar Index, a potential drop from 107 to 90 points over the course of a few months would instead be an event of particular importance.
There are therefore all the conditions for a bull of the dollar, even if for now it has risen.
It should be remembered, however, that it was the same in 2016.
The US presidential elections that year were held on November 8, and Donald Trump won. From May to October, the Dollar Index rose from 93 to 98 points, and after Trump’s victory, it continued to rise further, reaching 101 points around the 20th of the same month.
In December, it then rose again, reaching 103 points shortly after the middle of the month.
It then remained at 103 points until January 4, 2017, and then began a long descent that brought it below 90 points over the course of 12 months.
While the Dollar Index dropped from 103 to 89 points, the price of Bitcoin rose from $1,000 to nearly $20,000.
The fact is that in the medium/long term, the price of BTC tends to be inversely correlated to the dollar, so if several months of decline in the Dollar Index follow one another, it is likely that Bitcoin will rise in the meantime.
