Bitcoin’s volatility has decreased below that of the Nasdaq and the S&P 500 for the first time since 2018
Bitcoin (BTC) continues to move in the same direction as traditional markets, although in recent weeks it has shown increased resilience to higher yields and a stronger US Dollar.
Moreover, according to statistics provided by Kaiko on October 24, Bitcoin’s rolling volatility over 20 days has now gone below that of the S&P 500 and the Nasdaq equities indexes for the first time since 2018.
Bitcoin’s volatility is often lower than that of the Nasdaq, which is composed of riskier tech equities and has a better correlation with the cryptocurrency market.
Notably, crypto trading expert TechDev pointed out on Twitter the closest correlation between BTC and weekly Nasdaq Bollinger Bands. TechDev also anticipates an “upward breakout and robust Bitcoin outperformance”
While Bitcoin volatility remains modest, FX volatility has reached post-pandemic highs. The Yen’s volatility has more than quadrupled since March as the Bank of Japan’s aggressive monetary easing has remained, notwithstanding the currency’s drop in early October.
The British Pound (GBP) had the greatest rise in volatility in September owing to the UK government’s fiscal stimulus programmes, which caused a sell-off of British assets. The big increase in Bitcoin volumes on UK markets in September may be attributable to traders taking advantage of substantial FX volatility.
Notably, Finbold stated on October 24 that despite severe macroeconomic headwinds and a stagnating crypto market, Bitcoin outperformed stocks and the most of major fiat currencies in the third quarter of 2022, save for the US Dollar Index (DXY).