$DXY and $ETH update (high timeframes)
Why $ETH hasn't been "performing" and why it likely will.
A slight unusual update but it's been a while I have done $DXY and since last time, it hit some major targets. I also haven't done $ETH in a while and I haven't "revealed" my thoughts about the $ETH-$DXY correlation (yes, it exists and is better than $BTC - $DXY) yet. So granted there is a lot of doubt and fear around $ETH, granted $DXY reversed off a major POI and because it's weekend and I still expect $BTC to range in a tight range, no better time to showcase this analysis.
$DXY
So per context, as per last $DXY post, it's in a large range after its first major rejection off the entire 2021-2022 bull run, then it ran high to retest the major HTF rejection and it reacted off of it.
Personally, I project a second local retest here, but it currently just broke down further.
Whether we get the classic local V-shape (as drawn out), or trade down from here, I don't know and those local hick-ups are US monetary policy driven.
But I don't care either because I don't trade $EU or $GU at the moment. The value in analyzing $DXY for me is in the crypto correlation as it's the only chart I believe is important outside of crypto (unlike $ES or $NQ), for crypto holders, as I repeated many times before.
And so the overall plan is continued downside before new ATH's IMO. "Trump may try" to keep America strong, and that may be the narrative of the final squeeze. But chart-wise (all that matters), signals show there is no way of saving the dollar especially after all the printing and damage done in the past, the increasing US debt (the single international driven, which $DXY is an international asset class i.e. the dollar compared to other currencies), still increasing to this day.
$CNY has gained ground with their printing, which also contributed to the strength of the $DXY relatively, but also that won't last forever (it all moves in cycles).
$ETH - $DXY correlation
So all that matters to me is the correlation of crypto and $DXY. Talked a lot about the $BTC-$DXY correlation and how it works (it's a clean anti-correlation). But with the current relative fear of $ETH, the $ETH-$DXY is more interesting and looking at it, it's even tighter than the $BTC which is a nice plus.
Simply looking at the chart below (the monthly chart), the $ETH-$DXY anti correlation is clear and is probably one of the strongest cross-asset class correlations in existence.
The only time the correlation broke is after April where Sam BF - FTX CEO interfered and used billions of (non backed) credits to fake out the entire crypto space for a few months.
Another thing to note is that crypto has the upside adoption bias, an ever so slight slope alternation up, which causes the sideways (and slightly up) DXY periods to still be sideways and slightly up on $ETH (instead of slightly sideways and down). That adoption bias also appears on the overall chart, as both charts in their entirety slope sideways and up.
So with those correlations, that explains why $ETH hasn't been performing as well as $BTC, since $DXY went sideways, and $ETH is correlated more tightly to $DXY than to $BTC.
And that also explains my expectations for $ETH in the future, as its both expected from my end, and important for $DXY to put in a large monthly downtrend, which would put $ETH in the large monthly uptrend we are all waiting for.
Keep in mind that this is a monthly chart. Macro correlations don't work as reliably on micro scales as the name implies. One day or even one week or even one month of red $DXY doesn't mean $ETH has to be green and vice versa.
On that note, that also explains why $ETH hasn't been sending immediately, despite the current rejection of $DXY. The general trend takes time, nothing is perfect, whales control local pa to load up their bags their way, and so there are local delays and front runs in the time dimension.
Conclusion
Given my expectations of general downside on $DXY towards the end of 2025, and given the crystal clear anti-correlation of $ETH-$DXY, which is even stronger than the correlation of $BTC-$DXY, I explained with just two simple charts why $ETH hasn't been performing and why it likely is going to perform.
That also means that altcoins do well as when $ETH runs, altcoin confidence increases too, simply due to the fact that many altcoins are built on $ETH and $ETH is still the most involved network in the entire altcoin-multichain atmosphere.
150$-300$ challenge completed
5th challenge which I completed publicly
100$-1k (10x)
200$-2k (10x)
200$-1k (5x)
200$-400 (2x)
150$-300$ (2x)
Now I think I just need a girlfriend HaHa
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#Solana $SOL is testing a key support zone between $188 and $179, which previously served as resistance from March to November.RSI is at 31.72, a level that has held as support before, while the Stoch RSI is oversold.
I could be wrong, but all of this points to a rebound!