Strong Rally For Bitcoin And Crypto As Wall Street Melts Down

There’s a correlation between macroeconomic factors and crypto assets like Bitcoin. Harsh and stricter factors increase the volatility of virtual tokens negatively. This is also the case for equity stocks and their markets.

The past week brought a downtrend to the primary cryptocurrency. Bitcoin was seen going toward the $19,000 region without any anchor. The south movement by the entire crypto market became more drastic as the US Federal Reserve released its new rate increase. Also, the equity market was not left out of the trend.

Different Trends For Crypto And Equity Markets

But this new week brings a difference in the trend between the crypto and equity markets. Wall Street initiated a corrective mode for most of the stocks. There was a sudden meltdown for the 3 top US indices as they displayed a 1% correction on Monday, September 26.

Equity stocks and commodities plummeted by over 10%, but the MVIS CryptoCompare Digital Assets 100 index dipped by 1% within the last month.

Bitcoin and other cryptocurrencies defied the price drop in the equity market from the beginning of the week. Instead, prices in the crypto market have followed a bullish trend despite all odds. This created a huge surprise within and outside the space as the correlation link with Wall Street failed.

The price of BTC surged across the $20,000 level. This was after the struggle over the past week as BTC hit $19K. Some analysts expected that Bitcoin would gradually drop to its 2022 low of $17,500. But the token made an impressive move for the crypto space with its reclaims.

At the time of writing, BTC is trading around $19,114, indicating a miner decrease. Its market capitalization is currently over $387.5 billion. With the sudden rise in Bitcoin price, over $14 million of liquidations in short positions have occurred.

Strong Rally For Bitcoin And Crypto As Wall Street Melts Down
Bitcoin slows down after mounting over $20,000 l BTCUSDT on

OnChainCollege reported on the Bitcoin Mayer Multiple while citing Glassnode data. It noted that the multiple stalls are at a historically low level. Furthermore, a comparison with its 200-day moving average shows that Bitcoin is undervalued.

The broader crypto market is experiencing a price rally. Besides Bitcoin, the altcoins such as Ethereum (ETH), Avalanche (AVAX), and Solana (SOL) surged by over 6%. This new bullish trend for BTC and other crypto assets indicated the crypto market’s resilience to volatility, unlike traditional stock.

Bitcoin Could Break Correlation With Equity Stock

This year, the primary crypto asset displayed a higher correlation to the US equity market. Bitcoin’s price trend was similar to that of the S&P 500. However, BTC’s new price spike is breaking the link, though it’s only time that will tell.

Also, there’s a concern with the drop in the Bitcoin whale holdings this year. However, some analysts are neutral despite the uncertainties of the world’s macros.

On Monday, the founder of fairlead Strateies LLC, Katie Stockton, noted that the BTC rebound is suitable for short-term gauges. However, most people may remain neutral as they expect a quick failure in the bounce.

Source : newsbtc

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