#Bitcoin Correlation With Nasdaq Soars#
Hot Topic Overview
Overview
Recently, the correlation between Bitcoin and the Nasdaq 100 Index has reached its highest level since 2022, with a 30-day correlation coefficient of around 0.70, indicating a high degree of synchronicity in their movements. This surge in correlation is mainly driven by US inflation data, with investor reactions to inflation figures largely dictating the direction of digital currencies. Furthermore, the upcoming inauguration has significantly increased market sensitivity to interest rates, with investors hedging potential downside risks via the options market, further amplifying market volatility.
Ace Hot Topic Analysis
Analysis
Bitcoin's correlation with the Nasdaq 100 Index has recently reached its highest level since 2022, with a 30-day correlation coefficient of around 0.70, indicating a high degree of synchronicity in their movements. This surge in correlation is primarily driven by expectations surrounding the Federal Reserve's interest rate hikes and US inflation data. Analysts believe the upcoming Consumer Price Index (CPI) data will have a significant impact on both the stock market and Bitcoin, as investors will use the data to gauge the likelihood of future interest rate hikes by the Fed. Additionally, the upcoming US presidential inauguration could also amplify market volatility, as investors are taking hedging measures to mitigate potential downside risks. This high correlation suggests that Bitcoin is increasingly susceptible to macroeconomic factors, with its price movements closely tied to tech stocks. Investors need to closely monitor inflation data and Fed policy changes.
Public Sentiment · Discussion Word Cloud
Public Sentiment
Discussion Word Cloud
Classic Views
Bitcoin's correlation with the Nasdaq 100 index has reached its highest level in two years, indicating that the two are moving in tandem.
This correlation is likely due to increased investor sensitivity to interest rates, as well as expectations of reactions to US inflation data.
The upcoming release of US inflation data could have a significant impact on the price of Bitcoin.
Investors are increasing hedging activities to mitigate potential market volatility.