Bitcoin Price Prediction as Dollar Index Reaches 8-Week High Amid Rising Fed Hike Bets

Bitcoin (BTC) is down by 2.7% today, September 24, to trade at $84,061 at the time of writing. This drop comes on the back of a strengthening dollar, with the US dollar index (DXY) surging to an eight-week high.

Bitcoin’s drop below the $85,000 support has pushed the rest of the crypto market down, with Ethereum (ETH) falling to $2,683 while Ripple (XRP) has dropped by 7.5%.

All of the top ten cryptos were also trading in the green at the time of writing, while liquidations across the crypto market came in at $513 million per CoinGlass data.

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US Dollar Index Soars on Fed Hike Bets

The US dollar index briefly climbed to 101.231 on September 23, with this being the highest reading since July 29.

The dollar index is now up by 2.5% since the September 9 low of 98.755, with this rise coming on the back of rising odds that the Federal Reserve will hike interest rates.

Data from CoinGape prediction markets shows that 65% of traders are betting that the Fed will hike interest rates by 25 basis points at the October 2026 Federal Open Market Committee (FOMC) meeting.

If the Fed hikes like the market expects, it will push US interest rates to 4.00%-4.25%. This hike might weaken Bitcoin price because higher rates push people away from risk assets to less risky government bonds.

However, this hawkish policy is now drawing scrutiny from some members of the Trump administration.

The Director of the White House National Economic Council, Kevin Hassett, has questioned why the Fed is hiking rates, adding that Kevin Warsh is working with a mostly partisan Fed.

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Bitcoin ETF Inflows Persist Despite Fed Hike Bets

Data from SoSoValue shows that Bitcoin ETFs have recorded five straight days of inflows as Bitcoin price rises as geopolitical tensions ease.

These ETFs have recorded $2.06 billion inflows so far in the week starting September 21. If these inflows continue, Bitcoin ETFs might record their best week of trading since October 2025.

Bloomberg ETF analyst James Seyffart also noted recently that the average Bitcoin ETF holder is now back in profit after Bitcoin price moved above the ETF cost basis of $81,722.

The Morgan Stanley Bitcoin ETF (MSBT) has also seen $193 million in inflows so far this week. This ETF is now on track to have its best week of inflows since it launched in April.

Bitcoin Price Rally Cools at Key Resistance

Bitcoin price moved above the resistance of a bull flag pattern on September 18. However, the rally stalled after reaching another resistance at $86,600.

If BTC price can close above this resistance at $86,600, it could move to $90,000.

The RSI reading remains in bullish territory at 65, suggesting that Bitcoin could continue with the uptrend if buyers step back into the market.

Bitcoin price also remains above all the EMAs, suggesting that the future BTC outlook remains bullish. However, if the ongoing short liquidations push Bitcoin price lower, it might drop to test support at the 20-day EMA of $80,390.

The drop to the psychological support at $80,000 could stem from the rising dollar index and US Treasury yields that may push investors away from risk assets and into risk-free government bonds.