Bitcoin Diverges From Stocks as Fed Meeting Starts, Slips Toward $38K

It has become a rare occurrence these days but BTC went its own way, dropping on Tuesday as stocks rose.

AccessTimeIconMay 3, 2022 at 6:48 p.m. UTC
Updated May 11, 2023 at 3:49 p.m. UTC
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Bitcoin (BTC) slid, continuing its thus far uninspiring start to May, as crypto traders positioned ahead of a U.S. Federal Reserve decision due Wednesday.

The largest cryptocurrency by market capitalization was down 1.2% in the past 24 hours to around $37,719, as of press time.

A major market talking point in recent weeks has been bitcoin's elevated correlation with U.S. stocks, especially the tech-focused Nasdaq 100 Index. But the S&P 500 and Nasdaq were both in positive territory on Tuesday, as crypto markets appeared to suffer from negative sentiment.

  • “Bitcoin is steadying ahead of the [Federal Open Market Committee] as crypto traders await to see if Wall Street has come close to pricing in peak Fed hawkishness,” said Oanda senior market analyst Edward Moya.
  • “Bitcoin will continue to trade as a risky asset until further progress is made with the Lightning network,” said Moya. “Bitcoin needs a fresh catalyst, and progress in the peer-to-peer payment network might be what is needed to revitalize crypto bulls.”
  • “Since late March, the bears have been intensifying from $39K, forming a sequence of lower highs,” said Alex Kuptsikevich, senior market analyst FxPro. “At the same time, the basis in the form of support at $38K generally remains untouched.”
  • Kuptsikevich said the crypto market seems to have “laid at the bottom.” There is a high supply of coins for sale and reluctance to “take active actions in anticipation of the Fed’s decision.”
  • “According to Coin ATM Radar, the global bitcoin ATM installation rate declined for the fourth consecutive month in April,” Kuptsikevich said.
  • Marcus Sotiriou, analyst at the U.K.-based digital asset broker GlobalBlock, said that “despite the fears surrounding bitcoin volatility, data from @ecoinometrics shows how bitcoin’s volatility is actually less than many tech stocks, including Apple [AAPL] and Meta [FB].”
  • “It is clear that every halving leads to less volatility as the asset matures and is adopted more,” Sotiriou said.
  • Ether (ETH) was down 0.07% in the past 24 hours, trading at $2,794.
  • The S&P 500 was up 0.6% and the Nasdaq was up 0.1%.


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Angelique Chen

Angelique is a market contributor at CoinDesk.

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