Bitcoin held steady in the $19,100 territory, moving higher after two consecutive daily losses as stock traders bid up traditional markets ahead of Thursday’s expected release of critical Consumer Price Index (CPI) inflation data.
The CoinDesk Market Index rose 0.59% over the past 24 hours. At press time, bitcoin (BTC), the largest cryptocurrency by market capitalization, slipped 0.12% after coming back from the low of $18,971 earlier in the day. Ether (ETH) was up 0.27%, trading below $1,300.
Investors remained in a wait-and-see mode following the higher-than-expected U.S. Producer Price Index (PPI) numbers, a measure of the prices of goods sold by manufacturers Wednesday morning. Despite the U.S. Federal Reserve’s fight against inflation, wholesale prices rose 0.4% for September, compared with the Dow Jones estimate for a 0.2% increase.
Global macro sentiment has driven correlations across assets “back to extremes,” according to QCP Capital’s note. BTC’s correlation with equities and gold is “at all-time highs.” By contrast, the U.S. dollar’s correlation with bitcoin – historically an inverse relationship – is “at all-time lows.”
Stefan Rust, founder of economic data aggregator Truflation, said the markets would probably revert to a downward trend as the Federal Reserve continues its strategy of tightening monetary policy.
“In the past two years, crypto has been highly correlated to stocks and dependent on global fiat liquidity, so we can expect further drops or at least increased daily volatility around the release of the CPI figures tomorrow,” he told CoinDesk via an email.
Among altcoins, Solana’s native token SOL was down 2% after Solana-based decentralized finance (DeFi) platform Mango was hit by a $100 million exploit late Tuesday evening. As of press time, Mango’s MNGO token was down 33%, according to CoinMarketCap.
