Unlike in the past, the outcome of key macroeconomic catalysts does not appear to be having a significant impact on Bitcoin's price.
, but signaled one more rate hike by the end of the year. While this development rattled the equity indices, the largest crypto asset fought back with tenacity.the bellwethers of the U.S. financial market Nasdaq 100 and S&P 500 fell 3.3% and 2.7% respectively, over the past week.
But despite the turbulence in traditional finance, Bitcoin stuck to its $26,500-level, achieving marginal weekly gains of 0.02% at press time. Moreover, the king coin’s monthly performance evidently outperformed that of TradFi assets.Therefore, it begs the question – What is keeping Bitcoin intact in a deteriorating macroeconomic environment?
As per IntoTheBlock, Bitcoin’s correlation with the U.S. Dollar Index hit zero recently. This played a part in shielding it from the ongoing rally of the index, which measures USD’s strength against a basket of six foreign currencies.Interest rate hikes by the Fed applies significant upward pressure to DXY, as the policy results in increased demand for dollars from foreign investors. This typically leads to a capital flight to safe havens like the USD from riskier assets like stocks and crypto.
However, the weakening correlation meant that issues pertinent to U.S. dollar movement would have little significance for BTC. These events underlined that Bitcoin was increasingly getting decoupled from TradFi entities and more sensitive to happening restricted to the crypto space.Most of the significant rallies in recent times came in response to news around Bitcoin spot exchange-traded fund applications.
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