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Bitcoin extended its decline to less than USD43'000 at one point, a two-week low, before recovering to USD43'500. Expectations of tighter monetary conditions continue to dampen risk-sentiment. The drop in digital assets overall continues to mirror the direction of equities, with a high correlation. For clues on whether Bitcoin will rebound to its Tuesday highs of USD47'000, traders may pay attention to the volatility in markets, as recent communication by Fed officials has been difficult for markets to digest, increasingly pricing steeper tightening, which could endanger the global recovery. On a technical picture, a strong move past the 50-day moving average (USD43'542) should be a positive signal for a resumption of the uptrend.

US stocks rocketed higher on Monday, erasing mid-day losses following Biden's budget proposal. The high beta stocks are showing solid momentum and memes stocks are back on stage, with names like GameStop and AMC displaying once again short-squeeze-type of behavior.  S&P500 futures are adding 0.1% this morning and nearing the psychological 4'600 resistance level. Will the bulls manage to break it? 

Bitcoin futures burst out above the 45'000 level resistance last week and a simple projection suggests there could be new highs in the weeks ahead. There have been talks of regulating cryptocurrencies more, but the start of the war in Ukraine may delay implementation as some funds are flowing to vulnerable people through cryptocurrencies. The current rally could have more room to run.

The US benchmark is back to Tuesday's high, with futures on the S&P500 now trading around the 4'508 level. The KEY question is whether bulls will manage to maintain the rally, or will the index see the same selling pressure as Wednesday... This morning, the negative sentiment in Chinese stocks (with the CSI300 down 1.8%) is adding pressure on stocks in Europe and the US. The following chart shows the 4'512 level to be an important resistance test. 

Stocks have taken on an entirely new character in 2022, with continuing weakness now putting stocks into a pronounced downtrend. The S&P500 is entering a “death cross” technical pattern, for the first time since March 2020. But historically, the death cross pattern has been a lagging indicator. Indeed, the index entered a death cross on March 2020, when global markets were battered by the pandemic, but it actually bottomed a few days earlier. Usually, by the time the two moving averages cross over each other, a big chunk of the damage is already done, and if the bottom isn’t in place, we might be getting close. Much more important to investors is the FOMC decision coming up tomorrow. Fed's assessment of the economy and its policy tightening trajectory are among key subjects that market participants will be watching for. Are we getting near the "Fed put"?