The Holiday Sell Off

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30 Dec 2024

The Holiday Sell Off

Bitcoin has faced a two-week drawdown of 16% in a strongly correlated sell-off to equity indices following the December 18 FOMC, with leverage and yields taking a nose dive.

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Global headwinds after FOMC

Global de-risking has followed the past two weeks since the FOMC, with Bitcoin down 11% and ETH dropping 15%, pushing ETHBTC toward 0.036. BTC’s 30-day correlation with the Nasdaq rose above 0.50 for the first time since late September, underscoring its alignment with equity markets. The December 18 FOMC meeting triggered the decline, with the Fed reducing its projected 2025 rate cuts from four to two. The press conference highlighted potential inflationary risks tied to a Trump presidency, diverging from prior narratives.