The U.S. dollar index remains under pressure as Donald Trump’s tariffs push investors to other currencies. The DXY index was trading at $99.95 on Tuesday, down by 9.20% from its highest level this year. It has also been hovering at its lowest point since July 2023, and a death cross it formed points to more downside in the coming months. The US dollar index could crash further More technical signals show that the U.S. dollar index has further downside potential. It has formed an inverse cup and shoulders pattern whose depth is about 9%. Measuring the same distance from the lower side of the cup points to further downside to $91. US dollar index chart | Source: TradingView Further, a key survey of institutional investors shows that most of them are bearish on the currency as the trade war continues. Sixty-one percent of respondents in Bank of America’s Global Fund Manager Survey see the greenback falling in the next 12 months. This is the most bearish these fund managers have been since 2006. These investors are concerned about Trump’s policies and their economic impact. The most urgent fear is tariffs, which analysts expect will affect the economy. Many fund managers believe the U.S. will sink into a recession this year. While Trump has walked back some tariffs, those on China remain at uncomfortable levels. Most Chinese goods flowing to the United States will receive a 145% tariff, affecting goods worth hundreds of billions of dollars. On Tuesday, Beijing announced that it would block Boeing purchases by its airlines. Further, the U.S. dollar index has dropped as Congress negotiates Trump’s funding bill, which includes $4.5 trillion in tax cuts. You might also like: Bitcoin price nears death cross as gold safe haven status continues A falling US dollar could benefit Bitcoin and most altcoins A deteriorating US dollar index could benefit Bitcoin ( BTC ) and altcoins for three reasons. First, most of these coins are traded in Tether, a stablecoin backed by the U.S. dollar. As such, a weakening greenback makes Bitcoin and these altcoins more affordable. Second, the ongoing dollar weakness is likely due to concerns about the American economy and the impact of tariffs. As such, there is a likelihood that the Federal Reserve will intervene and slash interest rates. Some Fed officials, like Christopher Waller and Susan Collins, have confirmed that the bank is ready to act in the event of a recession. Third, Bitcoin and altcoins could benefit as the U.S. dollar index falls because they are often considered safe havens. While Bitcoin’s price has dropped this year, it has performed better than the stock market. You might also like: Stocks, crypto eye gains as investors ponder next tariff moves
