Bitcoin Bull Case Strengthens Amid Dollar Weakness and AI Surge

The dollar index, a key indicator of the greenback's strength against major fiat currencies, plunged to 97.27 early Thursday, marking its lowest level since February 2022, according to TradingView data. This decline, fueled by growing expectations of a July Federal Reserve rate cut and disappointing housing and consumer confidence reports, has eased global financial conditions, catalyzing a nearly 10% rebound in Bitcoin's BTC price from weekend lows. As of the latest data, BTC/USDT trades at $107,153.66, up 0.168% over the past 24 hours, with a high of $107,590.61 and low of $106,414.03. Andre Dragosch, director and head of research for Europe at Bitwise, emphasized on X that the dollar index slide to March 2022 lows has bullish implications for global money supply growth and Bitcoin, reinforcing BTC's role as a hedge against fiat devaluation in risk-on environments.

Nvidia's Record High and Bitcoin Correlation

Simultaneously, Nvidia NVDA shares surged 4.33% on Wednesday to a record high of $154.30, driven by robust demand in AI and emerging technologies. This rally underscores a strong 90-day correlation coefficient of 0.80 between NVDA and BTC, indicating that both assets bottomed in late 2022 and have trended upward in tandem. The Nasdaq futures also formed a bullish golden cross, signaling sustained risk appetite. ETH/USDT, while currently at $2,425.56 with a 0.325% decline, reflects mixed altcoin performance; for instance, SOL/BTC jumped 2.66% to $0.00137, suggesting capital rotation into high-growth crypto assets amid AI-driven optimism. Traders should watch for NVDA's influence on BTC, as continued tech strength could push Bitcoin toward resistance at $108,500 (from BTC/USDC 24h high), with volume data showing moderate activity at 4.06885 BTC for BTC/USDT.

Recession Risks and Yield Curve Dynamics

Key recession indicators are flashing warnings, with the U.S. two-year Treasury yield dropping to 3.76% early today—its lowest since May 2—amid a 24 basis point monthly decline, while the 10-year yield fell 16 basis points to 4.27%. This has widened the 10-2 year yield spread, resulting in a bull-steepening yield curve. Wealth advisor Kurt S. Altrichter noted on X that such patterns historically precede recessions, cautioning that a break lower in the two-year yield could signal lost Fed control. Consumer confidence data released Tuesday by the Conference Board showed a 5.4-point monthly drop to 93, with the expectations index sinking to 69—well below the 80 threshold that typically indicates an impending recession. These cues heighten Bitcoin's appeal as a non-correlated asset, with BTC/USD trading at $107,350.00, up 0.691%, and altcoins like ADA/BTC rising 2.14% to $0.00000525, highlighting diversification opportunities during economic uncertainty.

Fed Rate Cut Expectations Fueling Crypto Optimism

Traders are pricing in accelerated Fed easing, with interest rate swaps now indicating around four basis points of cuts for the July meeting, up from near zero a week ago, as reported by Bloomberg. The CME FedWatch tool shows expectations of 60 basis points in total cuts across the year's remaining meetings, a significant increase from 45 basis points last week. This dovish shift, combined with oil price declines and recessionary signals, could further weaken the dollar and bolster Bitcoin's momentum. Current market data reveals ETH/BTC at $0.02265, down 0.962%, while DOGE/BTC gained 1.835% to $0.00000222, indicating speculative inflows. Volume trends, such as 169.3035 ETH for ETH/USDT, suggest traders are positioning for volatility around Fed announcements, with key support for BTC at $106,414.03 and resistance at $107,590.61.

For active traders, these cross-market dynamics present actionable opportunities: consider long positions in Bitcoin near support levels like $106,300, leveraging the dollar index slide and NVDA correlation for entries. Monitor altcoins with strong volume, such as AVAX/BTC up 6.733% to $0.00022670, for short-term gains. Risk management is crucial, with stop-losses around recent lows to hedge against potential recession shocks. Overall, Bitcoin's technical breakout, supported by institutional flows into risk assets, could propel prices toward $110,000 if dollar weakness persists and Fed cuts materialize.