#Bitcoin's Correlation with Nasdaq Heats Up#

Recently, the correlation between Bitcoin and the Nasdaq has significantly strengthened, reaching its highest level in two years. This suggests that the stock market's reaction to US inflation data could have a significant impact on digital tokens. Specifically, the 30-day correlation coefficient between Bitcoin and the Nasdaq 100 index is around 0.70, approaching 1, implying a high probability of their moving in sync. Analysts point out that Wednesday's Consumer Price Index (CPI) data will be crucial for the market due to the heightened sensitivity to interest rates lately. Additionally, Trump-related momentum could intensify in the days leading up to his inauguration, further impacting market volatility. Hedge activity in the options market is on the rise, indicating that investors are preparing for increased volatility. The ratio of bearish bets is increasing, reflecting investor concerns about potential downside risks. Overall, the heightened correlation between Bitcoin and the Nasdaq highlights the growing sensitivity of the digital currency market to macroeconomic factors. Investors need to closely monitor the impact of inflation data, interest rate changes, and political events on the market.