DXY: 2-way trades to dominate – OCBC
Source Fxstreet
The US Dollar (USD) traded higher, as vote count skews in favour of Trump at time of writing. DXY was last at 104.92, OCBC’ FX analysts Frances Cheung and Christopher Wong note.
Trump outcome may see a play-up of US-China trade tensions
“The 7 swings states of Georgia, North Carolina, Pennsylvania, Michigan, Wisconsin, Arizona and Nevada matter (account for 93 electoral votes). Early count (based of 79% votes counted) shows Trump gaining the momentum in Georgia while West Virginia flipped in favour of Trump. It is still early to call at this point and news flow of tally count should continue to drive 2-way trades in FX markets intra-day.”
Daily momentum remains bearish while RSI rose from near oversold conditions. Resistance at 105.20 levels. Support at 103.70/80 levels (21, 200 DMAs, 50% fibo), 102.90/103.10 levels (100 DMAs, 38.2% fibo retracement of 2023 high to 2024 low) and 102.30 (50 DMA).
“Outcome will have implications on FX as shifts in fiscal, foreign and trade policies may occur, depending on whether Trump or Harris is elected as the next President. A Trump outcome may see a play-up of US-China trade tensions and should pose upward pressure on USD, UST yields (i.e. long gold, short CNH). However, a Kamala Harris outcome should see anxiety ease. On this note, USD, UST yield can ease and Asian/ high-beta FX should find a breather.”
Disclaimer: For information purposes only. Past performance is not indicative of future results.
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The downturn occurred despite the reopening of the U.S. government on Thursday, which many had hoped would provide essential support for crypto markets. This year initially appeared promising for cryptocurrencies, particularly after the inauguration of President Donald Trump, who has established the most pro-crypto administration thus far. However, ongoing political tensions—including Trump's tariff strategies and the recent government shutdown, lasting a historic 43 days—have contributed to several rapid price pullbacks for Bitcoin throughout the year.
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Looking ahead, questions linger regarding the viability of the four-year cycle thesis, particularly given the increasing institutional support and regulatory frameworks now in place in the crypto landscape. Matt Hougan, chief investment officer at Bitwise, remains optimistic, suggesting a potential Bitcoin resurgence in 2026 driven by the “debasement trade” thesis and a broader trend toward increased adoption of stablecoins, tokenization, and decentralized finance. Hougan emphasized the soundness of the underlying fundamentals, pointing to a positive outlook for the sector in the longer term.
Bitcoin experienced a sharp decline this weekend, briefly erasing its 2025 gains and dipping below its year-opening value of $93,507. The cryptocurrency fell to a low of $93,029 on Sunday, representing a 25% drop from its all-time high in October. Although it has rebounded slightly to around $94,209, the pressures on the market remain significant.
The downturn occurred despite the reopening of the U.S. government on Thursday, which many had hoped would provide essential support for crypto markets. This year initially appeared promising for cryptocurrencies, particularly after the inauguration of President Donald Trump, who has established the most pro-crypto administration thus far. However, ongoing political tensions—including Trump's tariff strategies and the recent government shutdown, lasting a historic 43 days—have contributed to several rapid price pullbacks for Bitcoin throughout the year.
Market dynamics are also being influenced by Bitcoin whales—investors holding large amounts of Bitcoin—who have been offloading portions of their assets, consequently stalling price rallies even as positive regulatory developments emerge. Despite these sell-offs, analysts from Glassnode argue that this behavior aligns with typical patterns seen among long-term investors during the concluding stages of bull markets, suggesting it is not indicative of a mass exodus.
Notably, Bitcoin is not alone in its struggles, as Ethereum and Solana have also recorded declines of 7.95% and 28.3%, respectively, since the start of the year, while numerous altcoins have faced even steeper losses.
Looking ahead, questions linger regarding the viability of the four-year cycle thesis, particularly given the increasing institutional support and regulatory frameworks now in place in the crypto landscape. Matt Hougan, chief investment officer at Bitwise, remains optimistic, suggesting a potential Bitcoin resurgence in 2026 driven by the “debasement trade” thesis and a broader trend toward increased adoption of stablecoins, tokenization, and decentralized finance. Hougan emphasized the soundness of the underlying fundamentals, pointing to a positive outlook for the sector in the longer term.
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