Volatile macroeconomic conditions highlight Bitcoin’s association with US stock indices, with BTC/USD reaching its lowest level for March thus far.
Bitcoin (BTC) surpassed $43,000 following the March 3 Wall Street open, despite a downward trend in US equities.
Stocks, Bitcoin slide lower on the open
BTC/USD remained within a small intraday range on March 3 according to data from Cointelegraph Markets Pro and TradingView.
Overnight, $43,000 had maintained as support, but was subjected to several tests as traders eyed a potential bounce zone approximately $1,000 lower.
#BTC
take out the previous swing low, lining up nicely with the green box pic.twitter.com/rplkQ0rhIS— Crypto_Ed_NL *not asking to send DM's* (@Crypto_Ed_NL) March 2, 2022
“The final segment of our corrective structure prior to the third impulse wave from 10K to 60K+ was a triangle; it would be nice to see something similar here if our bottom is in,” popular Twitter account Credible Crypto stated on March 2, comparing current behavior to the bull run that began in September 2020.
“Remember a longer base typically leads to a stronger impulse. Pullbacks on $BTC to 38K–42K are healthy.”
Others who earlier considered a slightly higher local peak may enter before range-bound action resumes.
BTC/USD was about $42,500 at the time of writing, a low for March.
Stocks were volatile on the day, with the S&P 500 down 0.7 percent following the United States Federal Reserve’s clearest indications yet on a probable crucial rate hike.
Geopolitical upheaval centered on Europe remained the dominant macro force in play as Russia and Ukraine convened to continue negotiations.
Is safe haven status being restored?
Meanwhile, as macroeconomic events developed, professional trading firm QCP Capital concentrated on Bitcoin’s potential edge against the largest cryptocurrency, Ether (ETH).
Bitcoin, the firm stated in a March 2 statement to Telegram followers, is reclaiming its safe-haven status, whereas altcoins cannot.
“Even the vol markets mirrored the concentration on BTC, with 10d realized volatility being 4% higher for BTC than ETH (99 percent vs 94.5 percent ). Additionally, there has been significantly greater topside interest in BTC than in ETH, anecdotally “It was written.
“This has caused the implied vol spread between BTC and ETH to drop back to lows of around 7%. With the recovery bounce in spot, implied vols have been trading softer as well. BTC 1-month implied have fallen back to 65% from 80% highs.”
QCP said that, regardless of the size and timing of the rate hike, “some downside risk” should remain in Q2 as a result of Fed policy.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.
