Bitcoin holds steady as key catalysts aim to surpass the $110,000 mark.

Since Wednesday, the price of Bitcoin has been maintaining within a narrow trading range, marking six consecutive days with price volatility below 3%. This unusual low volatility has led traders to question whether a breakout could be influenced by the weakening of the US dollar, especially in the context of the deteriorating financial situation in America.

Although the movement of the US dollar is attracting attention, it still requires the synchronization of many important factors for Bitcoin to reach the milestone of 110,000 USD.

Source: x/ Web3NielsMany analysts point out that there is an inverse correlation between the strength of the dollar and price fluctuations of Bitcoin. However, historical data shows that there have been similar periods. A typical example is from August 2024 to April 2025, when Bitcoin demonstrated strength while the DXY index rose from 100 to 110, and then weakened as the dollar dropped to 104. This suggests that relying solely on a weaker dollar to explain a potential price increase of Bitcoin lacks a solid basis, as both assets have demonstrated strength simultaneously in the recent past.

The US dollar index (green, on the left) compared to Bitcoin/USD (on the right) | Source: TradingViewThe American economy remains a dominant force, accounting for 26% of global output. However, according to Global Investment Research, 46% of the revenue of companies in the Nasdaq 100 index comes from international markets. A weaker DXY index typically benefits these companies, as their foreign earnings become more valuable when converted to US dollars.

Will Bitcoin benefit from inflation and capital rotation?

Many investors still view Bitcoin as a riskier asset rather than a completely uncorrelated financial option. With the Nasdaq 100 reaching a record high on June 30, investor confidence is rising, encouraging some to shift from fixed assets to higher-risk assets, including Bitcoin.

Another potential factor that could drive Bitcoin above $110,000 is the re-emergence of inflationary pressure. The Personal Consumption Expenditures Price Index in America has remained below 2.3% from March to May, after a five-month period of inflation exceeding the Federal Reserve's target.

U.S. PCE Index | Source: Bloomberg, SaxoThe 10% import tariffs imposed by America in April are gradually being passed on to consumers as supply chains adjust. Karthik Bettadapura, co-founder and CEO of DataWeave, told Yahoo Finance: "What we saw in June was the first broad-based price increase, as suppliers began to adjust to higher costs."

Whether the correlation of Bitcoin with consumer prices holds or not, this cryptocurrency has long been promoted as a hedge against inflation, especially during the price surge in 2021. Bitcoin is often likened to digital gold, but the 114% increase in 2024 suggests that price surges can occur even in a low-inflation environment.

Although not directly related to Bitcoin, the ability to add Strategy (MSTR) to the S&P 500 is considered by some analysts to be a secondary driving factor. Joe Burnett, Director at Semler Scientific, remarked that "if included, a wave of passive capital will begin to chase Bitcoin."

Finally, the ability of Bitcoin to surpass the 110,000 USD mark could be driven by several factors: stronger risk appetite following record highs in the stock market, concerns about recovering inflation, and the potential inclusion of Strategy into the S&P 500—all of which could converge to create favorable momentum for BTC prices.

Mr. Giáo