Bitcoin could get the dollar drop bulls want this week without getting the liquidity rally they need

Bitcoin’s next macro catalyst may weaken the dollar without delivering the easier money bulls need.The European Central Bank’s Sept. 10 policy decision could strengthen the euro and push the dollar index lower, potentially offering relief to Bitcoin after its latest slide below $80,000. But a currency-driven drop in DXY would provide limited evidence that the financing conditions restraining risk assets have actually improved.Data from CryptoSlate showed that Bitcoin was trading around $78,800, down roughly 1% over 24 hours, after stronger US labor data revived expectations that interest rates could remain elevated.That leaves Thursday’s ECB decision as the next major macro event that could shift the currency backdrop before US inflation data return the focus to the Federal Reserve.The distinction will hinge on what moves alongside the euro. A sustained Bitcoin recovery would carry more weight if it coincides with lower real yields, easier credit conditions and gains in both BTC/USD and BTC/EUR. A falling DXY on its own could simply reflect Europe becoming relatively more attractive.A stronger euro can flatter Bitcoin’s dollar signalThe complication comes from how the dollar index ...