YTD the correlation between Nasdaq futures and Bitcoin is +87%, namely they have been dancing to the same tune.. However so far this month, with the FTX “money laundering Dems money through Ukraine” event, the two series have decoupled to -0.13%.
My view, macro wise, is that we are due a rotation: dollar up, equities down, commodities down, crypto down. The daily chart of Nasdaq here is difficult but here is an interpretation:
- The move up from the 13 October low is straggly – this is NOT the way big moves to the upside begin. The straggly chop is because a longer downtrend component is leaning into price.
- There was a channel breakout on 10 November but price tapped into the top of the up channel and pulled back hard and kind of died on its feet since, this looks like a Bull trap – price breaks to the upside and Buy stops of short sellers are “gunned” by savvy market makers and whales, then price collapses in on itself.
- All of this happened at natural resistance.
- Tight bearish “M” top in RSI.
My view is down hard soon.