Bitcoin trading data since April 1st of this year suggests that most of the sell-off happened during U.S trading hours
This year overall, and the second quarter of 2022 specifically, has been a very painful one for cryptocurrencies. The sell-off in the premier digital asset of Bitcoin and the associated cryptos has been ever more exacerbated by the deep dive in American equities. And I have touched base multiple times before on Bitcoin’s correlation with U.S stocks. This relationship has been very evident in the past few months.
Bitcoin is trading close to $29k at the time of writing — losing well in excess of 50% of its value since the peak it reached in late 2021. It has been a slow bearish grind ever since. Today’s chart (above) looks at the various trading sessions contributing to these massive losses. The chart measures the YTD BTC returns in the Asian, European & American trading sessions. Arcane research provided the data for the chart.
As you can see from the chart, the cumulative YTD BTC returns during U.S. trading hours YTD is -32.55% compared to European +16%. Overall, Bitcoin has seen neutral cumulative returns during European and Asian trading hours. BTC’s YTD cumulative returns during U.S. trading hours have plummeted from 4.2% on April 1st to -32.55% by June 6th. Basically, American traders have been driving the bearish market in BTC.
Having said that, the de-risking of positions by investors globally has been the main theme in financial markets and has contributed to the broad-based weakness in riskier digital assets. As long as the high-interest rate environment is in place, we are going to see continued pain for riskier assets.
Originally Published on Medium