We are still crabbing but saw some signs of decoupling from TradFi last week. That has persisted into this week but unfortunately, in the wrong direction.
Source: CoinGecko and Yahoo Finance
The S&P 500 saw a strong relief bounce after weeks of relentless selling. This came on the back of the release of the latest Fed FOMC Meeting Minutes, which reinforced earlier expectations of two more 50bps rate hikes in the next two meetings, but left the door open for possible policy flexibility after that as the economic situation responds to monetary policy tightening. Last week’s relief rally was probably the result of “no news is good news”, and some hopium that the Fed may slow down, or even pause tightening measures if they see inflation trending in the right direction. We’re keeping an eye on inflation numbers, and also employment as the jobs market (including crypto jobs) responds to slowing economic growth.
Usually when there’s an equities relief bounce, crypto follows suit, but BTC was noticeably lackluster, still trading within range but with a slight deviation dump. You can think of crypto as a risk-on asset for institutions. When stocks rally, crypto often rallies higher. At the time of writing, however, BTC broke the $30k range and did a mini-short squeeze to $31k. In other words, BTC’s reaction could just be a delayed effect over the weekend as market participants make their move. The timing of these moves aligns with Asian markets opening, suggesting that Asia has been buying the dip - this has been noticeable over the past few weeks, more so than US markets in any event. While we are not financial analysts, we do want to highlight that a lot of CT influencers with good trading track records are growing more confident of a bottom forming, including CL207, Pentoshi, Wolf, Zaheer, and even DegenSpartan, the stablecoin maxi. If you are a more conservative trader, however, you might want to wait for the US markets to open on Monday and see where that leads.
