- The crypto market is highly correlated with the stock market, moving in tandem with the latter.
- The US job report cites reduced unemployment rates, to which the stock market may react positively.
- The community expects a bullish crypto rally in response to the US jobs report.
Recent reports offer a glimmer of hope to the crypto community, which has been navigating a turbulent market. A new Bloomberg report highlights the growing correlation between crypto and equities, suggesting a potential crypto boom following the positive U.S. jobs report.
The report discusses the decreased unemployment rate, alleviating concerns of a weakening labor market. The Labor Department’s weekly jobless claims report also revealed the unemployment rate falling to levels last seen in mid-June. This signals a lower likelihood of U.S. Federal Reserve interest rate hikes, potentially fueling a bullish crypto rally.
Correlation Between Crypto and Stocks
The US jobs report is a key economic indicator that can significantly impact both the stock market and the crypto market. Additionally, the strong correlation between the two markets further supports the idea of a potential shift triggered by the US jobs report. As the crypto market often moves in tandem with the stock market, it’s likely to mirror the latter’s reaction to the jobs report, whether positive or negative.
The Bloomberg report details the correlation between the crypto and stock markets. The correlation coefficient between the top 100 cryptocurrencies and the MSCI world shares index is approximately 0.60, suggesting a strong positive correlation.
Last month’s job report was weaker than expected, leading to increased market volatility and a crypto dip. However, with the recently released jobs report showing a positive outcome, the community remains optimistic about its impact on Bitcoin and other cryptocurrencies.
Analyst’s Take on Bitcoin’s Outlook
Magnet Capital’s co-chief investment officer, Benjamin Celermajer, commented on Bitcoin’s response to macro events, which are highly correlated to equities. He identified $55k as Bitcoin’s key support level, noting “pretty poor” sentiment over the last two weeks.As of press time, Bitcoin is trading at $56,329, with a slight decline of 0.84% in a day. Over the last week and month, Bitcoin has been trending downward, with drops of 4.3% and 0.83%, respectively.
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
