In a sign of continued maturity as a macro asset, bitcoin now looks to be leading the price action in the foreign exchange markets (FX).
“The dollar slid back to flat on the day on Monday after a surge in bitcoin to record highs foiled the U.S. currency’s attempt to rally back from [U.S. nonfarm] payrolls-inspired losses in the previous session,” a Reuters article published earlier this week says.
The article claims that the Tesla-led rally in bitcoin helped EUR/USD (euro-dollar exchange rate) extend Friday’s gains in the wake of dismal Eurozone investor confidence data.
A closer look at the two markets’ price action shows that EUR/USD, the most liquid currency pair globally, tracked bitcoin higher following the Tesla news.
EUR/USD broke out of a descending channel (above left) at 14:00 UTC on Monday, signaling a continuation of Friday’s rise from 1.1990 to 1.2040, which was fueled by the dismal U.S.