Bitcoin has extended its pullback, slipping below the $87,000 level as selling pressure and macro uncertainty keep traders on the defensive. The cryptocurrency is trading in a fragile range with weak momentum, following multiple failed attempts to regain key resistance zones. This decline has reignited a critical market debate: whether a weakening US dollar automatically provides a bullish tailwind for Bitcoin.
A CryptoQuant report clarifies that the relationship is indirect and conditional, not mechanical. The driver behind the dollar's devaluation is the key variable. The analysis outlines three primary scenarios. First, if dollar weakness stems from persistent inflation and a search for protection, Bitcoin can benefit as a form of "digital gold." Second, if the decline is driven by central bank rate cuts and excess liquidity, risk assets like crypto typically outperform as investors seek higher-beta returns.
However, the third scenario is most relevant to the current market environment. If the dollar is weakening due to a confidence shock and extreme risk aversion—such as rumors of yen intervention—crypto tends to fall alongside equities. In this case, the weak dollar is merely a backdrop, not a bullish engine. The report concludes that during such panic, investors are rotating from the dollar into traditional safe havens like gold, while Bitcoin ETFs see heavy outflows.
From a technical perspective, Bitcoin is trading around $87,900, trapped in a corrective structure that began after the late-2025 peak. The price is now trading below its major moving averages, with the 50-period average acting as dynamic resistance. Rebound attempts continue to lose strength, indicating cautious demand. For bulls to rebuild momentum, reclaiming $90K and then breaking above the $92K–$95K resistance zone is necessary. Failure to hold the $87K–$88K region opens downside risk toward $84K and potentially the low-$80K zone.
