Bitcoin price poised for ‘up only mode’ as US bonds experience largest selloff since 2019
Bitcoin (BTC) is currently transitioning into what former BitMEX CEO Arthur Hayes refers to as “up only mode,” as a deepening crisis in the US bond market potentially redirects investors from traditional safe-haven assets toward alternative stores of value.
Loss of faith in US policy increases Bitcoin’s upward potential
On April 11, the benchmark US 10-year Treasury yield spiked above 4.59%—its highest level in two months.
US 10-year Treasury note yields daily performance chart. Source: TradingView
This week, the $29 trillion US Treasury market experienced a more than 2% decline — marking its most significant drop since September 2019, when an issue in the repo market forced the Federal Reserve to intervene.
The erratic tariff announcements and subsequent reversals by US President Donald Trump have fueled the turmoil. Following threats of extensive tariffs on global trading partners, Trump swiftly rescinded many of the measures within days for specific countries, excluding China.
The US dollar’s strength against major foreign currencies, as monitored by the US Dollar Index (DXY), fell below the 100 mark for the first time since 2022.
US Dollar Index daily performance chart. Source: TradingView
Conversely, amidst the US bond market turmoil, Bitcoin surged by over 4.50%, reaching approximately $83,250, driven by expectations that the weakening macroeconomic conditions could lead US policymakers to take action.
“It’s on like donkey kong,” Hayes wrote on his X post on April 11, adding:
“We will be getting more policy response this weekend if this keeps up. We are about to enter UP ONLY mode for $BTC.”
Bond traders are now factoring in at least three rate cuts from the Federal Reserve by the year’s end, with a fourth cut becoming increasingly probable. Historically, rate cuts have had a positive impact on Bitcoin.
Target rate probabilities for December Fed meeting. Source: CME
Bitcoin anticipates a ‘parabolic bull run’ due to a weaker dollar
History shows that sharp declines in the US Dollar Index have preceded delayed but impressive Bitcoin bull runs, according to crypto analyst Venturefounder.
“A falling DXY has typically been a strong bullish signal for Bitcoin,” the analyst stated on X, highlighting a distinct bearish divergence on the chart.
DXY vs BTC/USD monthly price chart. Source: TradingView/Venturefounder
The analyst added that if the DXY continues to decline toward the 90 level, it could create conditions similar to those that have triggered parabolic BTC rallies during the final stages of past bull markets — each lasting up to a year.
Furthermore, Bollinger Bands creator John Bollinger expressed a bullish outlook for Bitcoin, noting that the cryptocurrency is establishing a familiar bottom at $80,000.
Related: Bitcoiners’ ‘bullish impulse’ on recession may be premature: 10x Research
Additionally, a maturing falling wedge pattern on the BTC price chart suggests a potential rally in Bitcoin’s price towards $100,000, as detailed by Cointelegraph earlier.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
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