Many people say, “When crude oil falls, $BTC rises,” but that leaves out the most important part: Why is oil falling?
If it’s because supply is recovering and inflation is cooling, risk assets could benefit. But if the economy is weakening and demand is collapsing, that’s a different story.
Cross-market analysis should start by identifying the drivers, then look at how capital responds. Two charts moving in opposite directions for a few days is nowhere near enough to establish a trading rule.
My take: Correlation ≠ causation. Jumping in as soon as you spot a divergence can get you burned. The same goes for $ETH —don’t rush to conclusions before you understand the macroeconomic drivers.
#BTC #Crypto
If it’s because supply is recovering and inflation is cooling, risk assets could benefit. But if the economy is weakening and demand is collapsing, that’s a different story.
Cross-market analysis should start by identifying the drivers, then look at how capital responds. Two charts moving in opposite directions for a few days is nowhere near enough to establish a trading rule.
My take: Correlation ≠ causation. Jumping in as soon as you spot a divergence can get you burned. The same goes for $ETH —don’t rush to conclusions before you understand the macroeconomic drivers.
#BTC #Crypto