The US Dollar Index (DXY) is on track for its strongest monthly performance since June, rising nearly 2% in September. On September 29, the index reached 101.61, marking its highest level since late July. Analysts at Barchart note that the index is nearing its highest closing price since April 2025.
The dollar's growth follows a hawkish shift from the Federal Reserve, which increased interest rates by 0.25% on September 16. Fed officials, including Michael Barr and John Williams, have indicated that further rate hikes may be necessary to address inflation. Additionally, 30-year Treasury yields have reached their highest point since 2002.
Despite the traditional inverse correlation between the dollar and Bitcoin, the cryptocurrency has gained 6.14% in September, defying the historical average monthly loss of 2.42%. On September 20, Bitcoin closed above its 50-week moving average for the first time since November 2025, a signal historically associated with market recoveries.
Market data from Binance Research highlights a golden cross on September 8, following 293 days below the 200-day moving average. Historically, October is Bitcoin's strongest month, with a median return of 14.71% and positive performance in 10 out of 13 years. Investors are now awaiting PCE inflation data and payroll reports to gauge future Fed policy.
