Bitcoin led a rally in cryptocurrencies on Monday as investors turned to the digital asset amid robust US jobs data.
By mid-morning trading in London, the largest cryptocurrency by market value was up 4% above the $24,000 mark, while ether was up 3% at around $1,770. The sector gained support along with similar movements in European stocks and US stock futures. after a strong payrolls report suggested the world’s largest economy could avoid a hard landing even as the Federal Reserve tightens aggressively.
Altcoins added to the sea of ​​green, Bloomberg price data showed, with SOL Solana, DOT Polkadot and AVAX Avalanche rising more than 3% in the past 24 hours.
“Market sentiment looks a bit choppy this morning, and yet crypto seems to have recovered much faster from Friday’s shock,” Craig Earlham, senior market analyst at Oanda, said in a call to clients.
Bitcoin is “targeting $25,000,” he said after rallying last week after a few months of heavy trading. “Momentum indicators will be exciting here as the recovery seemed to be losing momentum during the last rally in late July.”
A prolonged bear market in cryptoassets has seen bitcoin lose more than 47% of its value this year, and it remains about 65% below the all-time high of $68,991 it hit last November. Knocked down by a series of corporate bankruptcies and the failure of major decentralized finance project Terra in May, the crypto market struggled to recover in a series of mini rallies this summer.
Despite ​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​front, money, traditional market factors such as monetary policy, the prices of bitcoin and other cryptocurrencies are affected by the price of crypto. Bitcoin maintains a strong relationship with indices such as the S&P 500 and Nasdaq 100, with a correlation above 0.6 on Monday. A level of 1 would mean that both are trading in lockstep, while 0 would mean that they are not linked at all.
“Given another 75 basis point rate hike next month, a favorable outcome now, although a lot can change in that time, it could be a nervous few days for investors ahead of Wednesday’s inflation report,” Earlam said.
© 2022 Bloomberg
