#markets #bond #crypto
đ„ Bond markets are in turmoil, yet $BTC and Wall Street remain calm: what is happening in the markets?
A striking divergence in financial markets: while the US debt market signals rising risks, crypto and stocks are acting as if everything is under control.
đ Key figures and facts:
The MOVE Index (measuring expected volatility in US Treasuries) has surged from 80 to 104âits highest level since March.
The cause: another spike in oil and diesel prices driven by the conflict in the Middle East, which has reignited inflation fears. Yields on 10-year US bonds approached the 5.2% mark.
Meanwhile, BVIV (Bitcoin volatility) remains at 37 (close to the yearly low of 35).
The VIX (S&P 500 volatility) is also hovering near the bottomâaround 14.
â What is the anomaly?
For the first time since April 2024, the correlation between MOVE and VIX has turned negative (-0.06). The relationship between MOVE and Bitcoin volatility is even more negatively correlated (-0.37). In other words, the bond market is actively buying "insurance" against turbulence, while crypto and stocks remain relaxed.
â ïž What does this mean?
Typically, a spike in Treasury volatility leads to tighter financial conditions and puts pressure on risk assets. The bond market is sending an alarming signal that $BTC and Wall Street are currently ignoring. Is this a sign of the ironclad resilience of risk assets, or merely the calm before the storm?
đ„ Bond markets are in turmoil, yet $BTC and Wall Street remain calm: what is happening in the markets?
A striking divergence in financial markets: while the US debt market signals rising risks, crypto and stocks are acting as if everything is under control.
đ Key figures and facts:
The MOVE Index (measuring expected volatility in US Treasuries) has surged from 80 to 104âits highest level since March.
The cause: another spike in oil and diesel prices driven by the conflict in the Middle East, which has reignited inflation fears. Yields on 10-year US bonds approached the 5.2% mark.
Meanwhile, BVIV (Bitcoin volatility) remains at 37 (close to the yearly low of 35).
The VIX (S&P 500 volatility) is also hovering near the bottomâaround 14.
â What is the anomaly?
For the first time since April 2024, the correlation between MOVE and VIX has turned negative (-0.06). The relationship between MOVE and Bitcoin volatility is even more negatively correlated (-0.37). In other words, the bond market is actively buying "insurance" against turbulence, while crypto and stocks remain relaxed.
â ïž What does this mean?
Typically, a spike in Treasury volatility leads to tighter financial conditions and puts pressure on risk assets. The bond market is sending an alarming signal that $BTC and Wall Street are currently ignoring. Is this a sign of the ironclad resilience of risk assets, or merely the calm before the storm?
