Market deep dive: A look at the influences that shaped the crypto market this week

A volatile week is coming to an end.

The week began with fears about the ongoing war in the Ukraine, and fresh lockdowns in China leading to further disruptions of global supply chains. The country reported its worst COVID-19 outbreak since early 2020.

Asian stocks were volatile in trading. The Hong Kong Hang Seng Index tumbled, and was down more than 10% by Tuesday’s close.

Cryptocurrencies followed the broad risk off sentiment, whereas BTC held off comparably well, trading above intra-month lows of $37k.

Strong retail sales data from China on Tuesday, and assurance from Chinese officials that economic growth has top priority, helped calm the markets.

There were hawkish signals from Wednesday’s FOMC meeting – an announced 0.25% hike and projections for another six 25bps increases this year – could not stop the strong momentum in the market that had already been building up during the day. BTC$ was trading comfortably above 41k, and an equity market rally (led by NDX) closed 3.77% higher.

Uncertainty for the coming week remains high: the intensification of the Russian-Ukraine conflict, further lockdowns in China, rising inflation, and the impact of US rate hikes for economies already facing various supply shocks all bring the potential for more choppy markets.

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