A Multi-Asset Sell-Off to Start the Week, BTC down 4%

The Dow Jones Industrial Average is down 3% as of this writing, gold is down nearly 2.5%, and in the crypto market we’re seeing some real carnage. The VIX volatility index is up 17% today and is now trading at 30 points, which is above average even for this year.

Volatility S&P Index

As we mentioned last week, the Federal Reserve and other central banks have already injected quite a lot of stimulus and are already committed to keeping rates suppressed for a long time to come, so there doesn’t seem to be much in the way of action from them for markets to look forward to.

In the markets of course, there’s always a winner, and today is brought to you by the U.S. dollar, which is the main benefactor of today’s action. The Dollar Index is now nearing it’s highest level since July.

Though some traders might try and take advantage of the current highs (94) and lows (92) to trade the range, I’m really seeing this more as a consolidation period and waiting for a breakout in either direction. A strong dollar surge could really catch a lot of traders unprepared at this point.

USD currency index

Back to 10k

Though most traders might be completely spooked by a loss of nearly 5% in a day, bitcoin hodlers aren’t breaking any sweat. Even the old memes depicting the hodl mentality have begun to fade.

The price per bitcoin is $10,000, and it has traded around this level with few exceptions since mid-2019. The average price over the last 200 days is now just shy of $9,200.

So, while stock traders are currently dealing with a two-month low in a market that’s largely driven by momentum, bitcoin is seeing incredible stability in a market that’s largely been driven by stocks.

True believers, however, are quite sure that it’s only a matter of time before we see a true decoupling, when these multi-asset sell-offs won’t affect crypto assets quite as much. I guess we’ll need to wait and see how this plays out.

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