What is DXY?
The US Dollar Index (DXY) measures the value of the United States dollar relative to a basket of six foreign currencies:
| Currency | Weight |
|---|---|
| Euro (EUR) | 57.6% |
| Japanese Yen (JPY) | 13.6% |
| British Pound (GBP) | 11.9% |
| Canadian Dollar (CAD) | 9.1% |
| Swedish Krona (SEK) | 4.2% |
| Swiss Franc (CHF) | 3.6% |
How to Read It
- DXY = 100: Baseline value (set in 1973)
- DXY above 100: Dollar is stronger than the baseline
- DXY below 100: Dollar is weaker than the baseline
Typical range: 90-110
Why It Matters for Crypto
Bitcoin and crypto assets often show an inverse correlation with DXY:
| DXY Movement | Typical Crypto Impact |
|---|---|
| DXY rises | Crypto tends to fall (risk-off) |
| DXY falls | Crypto tends to rise (risk-on) |
The Mechanism
- Liquidity: Strong dollar = tighter global liquidity = less capital for risk assets
- Risk appetite: DXY strength often coincides with risk-off sentiment
- Emerging markets: Dollar strength pressures EM currencies, reducing crypto buying power
Key Levels
| Level | Significance |
|---|---|
| 100 | Psychological level |
| 103-104 | Recent resistance |
| 90 | Historical support |
In Our Reports
We track DXY as part of the macro backdrop. Significant DXY moves often precede or accompany crypto market shifts, making it an important context indicator.