HSBC issues urgent risk-on order as dollar reaches 2021 lows, potentially impacting Bitcoin’s next movement.

On January 27, HSBC released a recommendation for investors to adopt an aggressively risk-on stance. The bank advises increasing exposure to equities, high-yield bonds, emerging-market debt, and gold while decreasing holdings in sovereign debt, investment-grade credit, and oil.

This recommendation is based on a particular macroeconomic outlook: US growth remains resilient, rate volatility is kept in check, and markets are shifting back towards major technology companies. Additionally, the US dollar has fallen to its lowest point since 2021, trading at 96.206 as of the time of this report.

This situation prompts the question of whether the dollar’s multi-year low could foster a greater risk appetite for Bitcoin.

HSBC’s argument is not merely about currency; it represents a perspective on volatility and growth, which is significant because Bitcoin functions as a high-beta risk asset under certain conditions and as a liquidity or FX hedge in others.

The current environment necessitates an evaluation of which behavior is currently dominant.

Related Reading

Bitcoin's $100k breakout silently crippled its adoption curve as on-chain metrics crater

For the first time in Bitcoin’s history, price increases are no longer consistently linked with growing on-chain adoption.

Jan 27, 2026 · Liam 'Akiba' Wright

Who else is positioned risk-on

HSBC is not the only institution taking this stance. JPMorgan’s allocation for the first quarter of 2026 indicates a “pro-risk tilt,” with overweight positions in US, Japanese, and select emerging-market equities, alongside an explicit underweight in the dollar and a favorable outlook on gold.

Invesco’s perspective for the first quarter maintains a moderate overweight in equities compared to fixed income, favors riskier credit exposures, and also highlights an underweight position in the dollar.

BlackRock’s recent bi-weekly market analysis continues to endorse risk assets at a structural level.

The trend is clear: major investors are gearing up for a risk-on approach while decreasing their dollar exposure.

This combination theoretically bolsters assets regarded as both risk proxies and alternatives to the dollar, and Bitcoin qualifies in both categories at different times. The key question is which perspective is relevant now.

Institution	Overweight	Underweight	Stated driver	BTC implication
HSBC	Equities; high-yield credit; EM debt; gold	Sovereign bonds; investment-grade credit; oil	Markets influenced by US rates + growth (not geopolitics); rate vol contained; shift towards mega-cap tech	BTC tends to act like a risk-beta if volatility remains contained
JPMorgan	Equities (US, Japan, parts of EM); (constructive) gold	US dollar	“Pro-risk tilt” with leadership from equities; Fed cuts / macro environment perceived as supportive; gold as a diversifier	Supports BTC through risk-on channel more than USD-hedge channel
Invesco	Equities vs fixed income; credit risk (riskier credit exposure)	US dollar	Moderate equity OW vs FI; favors credit risk; notes UW USD	BTC upside more likely if the regime stays risk-on (equity/credit favorable)
BlackRock	Risk assets / US equities (structural risk-on framing)	(Often) long-duration government bonds as less preferred vs equities; uses gold tactically	Pro-risk stance linked to macro regime (policy/rates backdrop); gold as tactical diversifier/hedge	BTC tends to align with equities/liquidity when risk appetite is strong and volatility is low

Related Reading

Save the Bitcoin bull run by dropping these 8 days which changes the dollar weakness story

Bitcoin’s January weekend downturn is wiping out all weekday gains, leaving portfolios in a precarious state.

Jan 27, 2026 · Liam 'Akiba' Wright

Dollar weakness has two faces

A declining dollar can manifest in two distinct macroeconomic regimes, each with different consequences for high-beta assets.

In a risk-on regime marked by accelerating global growth, functioning carry trades, and easing financial conditions, dollar weakness tends to benefit high-beta assets as capital flows towards growth and yield.

Conversely, in a risk-off regime defined by fears surrounding US growth, policy uncertainty, and increasing volatility, dollar weakness may indicate a shift of capital away from US assets, even as risk appetite diminishes.

In this latter scenario, a declining dollar and falling risk assets may correlate.

HSBC’s assertion is based on the first regime: stable growth and contained volatility. If this assumption proves accurate, Bitcoin should gain from both the dollar’s decline and the overall risk-on attitude.

However, if volatility escalates or growth fails to meet expectations, the dollar’s weakness may become insignificant or even indicative of negative trends. This distinction is crucial since Bitcoin’s responsiveness to each factor can vary over time.

Related Reading

US Treasurys face a $1.7 trillion EU “dump” over Greenland, forcing shift to Bitcoin if dollar safety vanishes

European leaders are eyeing U.S. Treasurys as leverage in the Greenland matter, risking a one-month yield shock for Americans.

Jan 21, 2026 · Liam 'Akiba' Wright

Testing Bitcoin's dollar and risk-on sensitivity

A systematic approach to determine whether the dollar’s decline impacts Bitcoin involves assessing the rolling correlation between Bitcoin’s daily returns and a dollar index proxy over the past 60 to 90 days.

A significantly negative correlation, reflecting below -0.3, indicates that dollar weakness provides a mechanical tailwind. Conversely, if the correlation hovers around zero or is positive, the relationship of “dollar down, Bitcoin up” is not active, making the dollar’s level merely background noise.

As of this report, the 60-day rolling correlation between Bitcoin and DXY stood at -0.036, while the 90-day rolling correlation was at +0.004. In this case, the dollar’s fluctuations do not suggest an upward trend and are merely background noise.

However, historical trends demonstrate that this correlation can vary greatly. During liquidity-driven surges, Bitcoin frequently displays a strong negative correlation with the dollar as both react to global liquidity conditions.

In times of risk-off sentiment, the relationship can reverse or even collapse completely. The current correlation will determine whether the dollar’s four-year low serves as a supportive factor or a misleading indicator.

The second test compares Bitcoin’s returns against a clear risk proxy, which consists of the S&P 500 and Nasdaq, over the same rolling timeframe.

The 60-day rolling correlation between Bitcoin and the S&P 500 is +0.536 as of this report, climbing to +0.591 over the 90-day window. For Nasdaq, the 60-day and 90-day correlations are +0.544 and +0.586, respectively.

Bitcoin’s 60-day rolling correlation with the dollar index is near zero as of January 27, while correlations with the S&P 500 and Nasdaq remain elevated above 0.5.

Related Reading

Bitcoin faces slide to $60,000 if impending US shutdown triggers a statistical blackout

With shutdown risks rising, Bitcoin traders are preparing for ETF outflows and potential data interruptions.

Jan 27, 2026 · Oluwapelumi Adejumo

Bitcoin’s stronger correlation with equities rather than the dollar implies that HSBC’s “risk-on with contained volatility” thesis is the prevailing influence.

This differentiation is vital because HSBC’s assertion is conditional. The bank’s risk-on perspective presupposes that rate volatility remains low and growth is stable.

However, if either assumption falters, such as through surges in rate volatility or disappointing growth data, the entire regime prediction could shift.

Bitcoin may then encounter challenges from rising volatility, even if the dollar continues its downward trend.

Microstructure layer and what the dollar signals

As of January 27, Bitcoin’s internal market structure presents mixed signals that complicate the narrative of macro tailwinds.

Data from Farside Investors reveals that spot ETF flows turned net negative for the month at -$110.3 million, indicating that institutional demand has diminished despite the broader risk-on environment.

Funding rates are near neutral, with OI-weighted at 0.0068% and volume-weighted at 0.0061%, suggesting that leverage is neither overly long nor positioned defensively.

CoinGlass indicates that options open interest stands at $36.49 billion, illustrating active derivatives positioning but lacking a clear directional bias based solely on the funding data.

The most encouraging signal from the microstructure comes from exchange balances: 2.47 million BTC remain on exchanges, close to the lowest level seen in the past year.

Decreasing exchange reserves generally indicate diminished selling pressure as holders transfer coins to cold storage, a behavior linked to longer time horizons and a reduced urgency to liquidate.

Coupled with neutral funding, this suggests that positioning is not excessively stretched, allowing for the macro tailwind to translate into upward movement without triggering immediate supply constraints from overleveraged longs unwinding.

The spot ETF outflows present a contradiction. Institutional allocators are not aggressively increasing exposure despite Wall Street’s risk-on positioning, which may imply that Bitcoin is not yet considered a primary beneficiary of the prevailing regime or that flows are lagging behind the narrative.

Regardless, the microstructure does not indicate defensive positioning that would obstruct macro transmission, but it also lacks the enthusiastic positioning that would amplify it.

Metric	Latest (Jan 27)	Signal	Why it matters
Spot ETF flows (MTD)	-$110.3M	Headwind	Net outflows imply institutional demand has lessened despite a risk-on sentiment
Perps funding (OI-weighted)	+0.0068%	Neutral	Near-neutral leverage; no crowded long positions to unwind
Perps funding (vol-weighted)	+0.0061%	Neutral	Confirms funding neutrality across higher-volume venues
Options open interest	$36.49B	Neutral	Heightened positioning, but direction unclear without skew/IV context
Exchange balances	2.47M BTC	Supportive	Lower exchange supply suggests diminished near-term selling pressure

The regime Bitcoin actually faces

The dollar’s decline to levels not seen since 2021 occurs within a hybrid regime rather than the clear risk-on setting that HSBC anticipates.

Financial conditions are loosening, which is the most apparent tailwind for high-beta assets. Volatility remains subdued in both equity and bond markets, supporting risk appetite. However, global growth is not picking up speed, expanding at its slowest rate in six months.

US growth demonstrates robust GDP forecasts, but these are countered by declining consumer confidence and poor job growth. Policy uncertainty persists and remains volatile, adding friction that can disrupt even favorable financial conditions.

This positions Bitcoin in a complex scenario. The dollar is falling in an environment of relaxed financial conditions and low volatility, both of which are conducive to Bitcoin as a high-beta risk asset.

However, the lack of growth acceleration and the presence of policy uncertainty imply that the macro environment is more precarious than HSBC’s framework suggests.

Bitcoin benefits from more lenient financial conditions and low volatility, yet faces challenges from mixed growth signals and policy noise that could trigger abrupt regime changes.

The trade remains viable as long as volatility remains contained and financial conditions stay relaxed, and these two conditions are currently met but not guaranteed, particularly in light of the heightened policy uncertainty that can quickly disrupt both.

The post Urgent HSBC risk-on order issued as dollar hits 2021 lows which could flip Bitcoin’s next move appeared first on CryptoSlate.