Digital Asset Market

 Bitcoin rose 2.69% in the past two weeks as of April 26, Ethereum rose 0.94%, and the rest of the market rose 2.02%. I think it showed a slight rebound after the big fall in early April.

The current digital asset market is more affected by the macroeconomy than anything else. The correlation between Bitcoin and NASDAQ seemed to be slightly lower, but it hit a new high again (Figure 1).

It can be interpreted that moving with NASDAQ is more affected by the macro economy than the fundamentals of the digital asset market. The macroeconomy is currently in bad shape because of hawkish central banks, the threat of stagflation and China's lock-down issues.

Especially, the situation in China is very bad right now. China's yuan has fallen by the largest margin since the 2015 plunge (Figure 2). China's purchasing manager index (PMI), called the leading economic index, had already been dampened, but growth has slowed down completely due to the lock down (Figure 3).

Of course, we're releasing money to overcome this, but it's unclear what kind of practical effect it will have while the lock down continues. Given China's share of the world economy, the risk of stagflation and global recession seems to be growing.

But I think the bitcoin and digital asset markets are holding up pretty well despite the bad macro economy. As you can see in the Bitcoin main salary chart above, we've been increasing the low point in the 100 moving average section. I think there could be momentum in the market if it lands above the 50 moving average. I think it will be important to understand the earnings season in the U.S., the FOMC meeting in May, and the status of China's lock-down over the next two weeks. We hope that digital assets will regain vitality despite many unfavorable factors.