Bitcoin was holding steady in midday trading, as investors in traditional markets reacted negatively to mixed earnings results from U.S major banks.
“BTC and ETH continue to defy the equity sell-off,” Tom Dunleavy, senior research analyst at Messari, told CoinDesk in an email. “If equities continue to sell off, we may continue to hold these levels as we have reached the base of long-term holders.”
Global markets resembled a roller coaster on Thursday after the hotter-than-expected Consumer Price Index inflation report was released.
Crypto analysts are increasingly speculating whether digital assets like bitcoin might decouple from equity markets.
“If U.S. stocks tumble below the 3,600 level this earnings season and bitcoin does not break below the summer lows, the crypto winter can officially be called over,” Oanda analyst Edward Moya wrote in a note Friday.
Messari’s Dunleavy noted that the stream of third-quarter earnings reports starting to roll out and further data on the labor market will be critical factors in the crypto market’s direction next week.
“If we continue to see labor market strength, the Federal Reserve will have even more ammo to raise 75 basis points or even 100 basis points,” Dunleavy said. Typically in past interest-rate-hiking cycles, the Fed has moved in increments of 25 basis points (0.25 percentage point) per meeting.
“Again, this could be a spot that traders see as an opportunity to sell,” Dunleavy said.
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