Bitcoin's correlation with the Nasdaq 100 hits highest level since 2022

Data shows that the 30-day correlation coefficient between Bitcoin and the Nasdaq 100 index is about 0.70, reaching the highest level in two years. A reading of 1 means that the assets move in sync, while a reading of -1 indicates an inverse correlation. "Overall sensitivity to interest rates over the past month suggests that the importance of Wednesday's CPI data has increased. In addition, Trump-related momentum may still increase significantly in the days before the inauguration." According to data from trading platform Derive.xyz, hedging activity in the options market is increasing, indicating that investors are preparing for increased volatility. Derive.xyz's head of research Sean Dawson said the proportion of bearish bets has increased, indicating that "investors are hedging potential downside risks as the inauguration approaches." (Bloomberg)