Crypto Market to Stay Highly Correlated to Stocks Amid Macro Events and Dwindling Network Activities, Citi Says
As we look ahead to the upcoming macro calendar, it is predicted that digital assets will continue to be closely correlated with equities. This correlation has been a key factor in the recent performance of cryptocurrencies and other digital assets.
Despite their decentralized nature, digital assets have often moved in tandem with traditional markets such as stocks and bonds. This means that events impacting the stock market, such as economic data releases or geopolitical tensions, can also affect the prices of digital assets.
Investors and analysts are closely watching this relationship between digital assets and equities, as it can provide insights into broader market trends and sentiment. Understanding how these assets move in relation to traditional markets can help investors make more informed decisions about their portfolios.
While some argue that digital assets offer a unique form of diversification, the data suggests that they are likely to remain correlated with equities for the foreseeable future. This means that investors in digital assets should continue to monitor developments in traditional markets and adjust their strategies accordingly.
Overall, the correlation between digital assets and equities is expected to persist, highlighting the interconnected nature of financial markets in today’s global economy.
