The correlation between Bitcoin and the Nasdaq 100 index has reached a level above 0.70 at a critical moment as markets anticipate the release of the next US Consumer Price Index report.
Bitcoin and Nasdaq Correlation
On January 15, analysts observed a correlation above 0.70 between Bitcoin and the Nasdaq 100 index, a level not reached since 2023. This coincide with Bitcoin's brief surge above $100,000. Jag Kooner from Bitfinex warns of potential increased volatility if inflation exceeds expectations.
Fed's Shadow over Crypto Market
The recent dip of Bitcoin below $92,500 primarily stems from concerns related to the US Federal Reserve's monetary policy. Ryan Lee from Bitget Research attributes this decline to robust US economic data suggesting prolonged high interest rates.
Future of Bitcoin and Global Economy
Crypto markets demonstrate a particularly strong responsiveness to monetary policy outlooks. The CME Group’s FedWatch tool currently suggests that markets are anticipating an initial rate cut for June 18, 2025, which could significantly influence Bitcoin's trajectory in the coming months.
The increasing convergence between cryptocurrencies and traditional markets marks a new era for Bitcoin, now more integrated into the global financial system. This evolution, while indicative of its maturity, also makes it more susceptible to macroeconomic turbulence.
