Dollar weakness may boost Bitcoin prices, but it may not be sufficient for Bitcoin to reach the $120,000 mark due to ongoing global trade tensions. Historically, Bitcoin has had an inverse relationship with the US Dollar Index (DXY), which tracks the dollar’s strength against other currencies. Recently, Bitcoin’s price dropped below $114,000 as the DXY reached its highest level in over two months. A recent decline in the DXY to 98.5 was exacerbated by disappointing US jobs data, prompting speculation of possible interest rate cuts by the Federal Reserve. Despite a weaker dollar, economic slowdown fears may cap Bitcoin's gains. An alternative sentiment gauge, the ICE BofA High Yield Option-Adjusted Spread, recently declined, reflecting improved credit sentiment that can bolster risk assets like Bitcoin. However, if the spread rises significantly, it could lead investors to seek safer, short-term US Treasurys. Currently, the market sentiment regarding the DXY's decline does not clearly indicate that Bitcoin will reclaim the $120,000 level soon, as uncertainties from economic conditions and trade tensions persist.

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