When looking at Bitcoin prices, I habitually check the NASDAQ as well.
Sometimes, when the US stock market drops, BTC quickly follows suit; other times, the NASDAQ rebounds, but Bitcoin shows little reaction. How closely are the two markets related? Can watching the US stock market help us judge BTC's trend?
On October 14, the US reported a year-on-year CPI increase of 3.7% for September, higher than market expectations. On that day, the NASDAQ fell about 1.9%, and BTC dropped below $82,000 at one point.
It is not surprising that both fell simultaneously. Interest rate expectations, the dollar's performance, and market sentiment can all affect investors' risk appetite. However, the US stock market and BTC do not always rise and fall together, as Bitcoin has its own funding and market logic.
For beginners, instead of guessing which side will lead the other, it's better to first learn to look at a few key indicators.
1. Why do the US stock market and BTC rise and fall together?
We mainly look at three factors.
Interest rate expectations. If inflation exceeds expectations, the market may worry about delayed interest rate cuts. The valuations of tech stocks can be affected, and BTC may also be pressured by changes in funding costs and risk appetite.
Market sentiment. When investors are more willing to take risks, tech stocks and crypto assets may attract funding; when the market turns cautious, both may fall simultaneously. If BTC faces concentrated contract liquidations, price volatility may also be amplified.
Changes in the crypto market itself. ETF fund flows, regulatory news, and contract positions can all influence BTC's movement. Sometimes when the US stock market drops, BTC remains strong, indicating that the crypto market has its own driving factors.
2. What information can be gleaned from these 4 indicators?
Beginners can start by looking at the NASDAQ and BTC. When both show significant fluctuations, check that day's economic data, Federal Reserve news, as well as changes in the dollar and US Treasury yields.
If you want to further understand BTC's own funding situation, you can also pay attention to spot ETF fund flows and contract liquidation data.
These indicators are not meant for directly predicting price increases or decreases; they mainly help us clarify: Is this round of price movement more like the entire market fluctuating together, or is BTC experiencing changes on its own?
3. How to interpret these 3 types of movements?
1. NASDAQ falls, BTC also falls
First, check if there are inflation data, interest rate expectation changes, or other announcements that day. If both are impacted, it may indicate that the market is synchronously reducing risk exposure.
Next, look at BTC's trading volume and price. If the volume breaks through recent important lows, it indicates that selling pressure is worth noting; however, whether it continues to fall afterward will depend on how the market behaves.
2. NASDAQ rises, BTC also rises
This may reflect that market sentiment has improved. You can also check BTC's trading volume and whether spot ETF fund flows align with it.
If only the price briefly rebounds without significant changes in other indicators, just observe for now and do not rush to conclude that the trend has reversed.
3. The US stock market and BTC move in opposite directions
This situation is also worth paying attention to.
- NASDAQ falls, BTC rises: Check if BTC has independent buying interest, or if there are positive developments in the crypto market.
- NASDAQ rises, BTC falls: Pay attention to factors such as ETF fund outflows and contract liquidations.
Inconsistent movements do not indicate that one market will immediately catch up with the other. Identifying potential reasons and then watching subsequent performances is usually more useful than predicting directions outright.
4. What can beginners do every day when trading?
You do not need to start by studying a multitude of indicators; instead, develop three habits:
- Check the NASDAQ: Understand the overall performance of the tech sector in the US stock market for the day.
- Look at market news: Pay attention to important economic data, interest rate expectations, and dollar movements.
- Check BTC: Combine price, trading volume, and recent highs and lows to see if it follows changes in the US stock market.
For example, if the NASDAQ drops and the dollar strengthens, and BTC also weakens, you can further explore whether there are common macro factors affecting the market. If the NASDAQ drops but BTC remains strong, take a closer look at changes in the crypto market's own funds.
This method does not guarantee accurate judgments every time, but it can help beginners gradually establish a trading mindset, no longer just fixating on price movements.
Finally, let's discuss the US stock market and the crypto market
The US stock market and BTC are linked, but this relationship can change with the market environment. Watching the NASDAQ can provide insights into overall sentiment, and observing interest rates and the dollar can supplement the macro background; BTC's own price and funding changes can provide another layer of reference.
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Risk warning: Investment in the US stock market still requires you to bear market risks, regulatory risks, and compliance risks with local laws and regulations (especially foreign exchange controls, overseas investment declarations, etc.). This content is solely for market observation and sharing and does not constitute investment advice. The crypto market is highly volatile, please participate within your risk tolerance.
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