Markets on edge

All investments and trading are risky and may result in the loss of capital. Cryptoassets are largely unregulated and are therefore not subject to protection.

Investors are scaling a monumental wall of worry and that was before health officials warned of a worsening monkeypox situation. For sure, though, this’ll be a week to remember.

On Wednesday, the U.S. Federal Reserve will announce a rate hike and give some indication of how hard it intends to continue to pump the brakes. On Thursday comes a GDP report that is expected to confirm economic slowing, unofficially signaling a recession, CFRA Research's Sam Stovall told CNBC earlier today. Markets crave clarity. By week's end, they will get some.

Possibly, peak hawkishness could be at hand. Just before the opening bell, U.S. stock futures were on the rise.

After notching its biggest weekly gain since March, Bitcoin was sliding on a tense Monday marked by volatility as traders prepare for a Fed rate hike of probably 75 basis points, but possibly 100 basis points. BTC was $21,950 as of 9 a.m. (EST), having declined 2.5% in 24 hours. Ethereum lost 3% in that span. Wall Street's most crowded trade – long USD, short risk assets – still has room to run if only out of respect for Fed hawkishness which, as previously mentioned, might have peaked.

As global economic fractures widen, crypto markets could defy the Fed-driven narrative surrounding the combined fate of risk assets, said Noelle Acheson, head of market insights at Genesis Global Trading. She sees signs of progress in crypto that bode well for digital assets distancing from stock market performance in coming months. ETH rallying ahead of "The Merge" is an example of a sign of progress, as is the suddenly resurgent DeFi sector.

Bitcoin dominance is a widely followed statistic with heavy implications for altcoins. The dominance number right now is 43%, which means 43% of total crypto market capitalization comes from BTC's market cap (of roughly $419 billion).

The BTC dominance level recently reached 48% but lately it has been falling. Could BTCD fall below 40%? Is that good news for, say, Ethereum? Sure, and perhaps.

"Since ETH is the largest altcoin by market cap, its movement is a big factor in changes in BTCD," BeInCrypto said.

Over the past week, ETH has gained about 14% versus 5% for BTC in those seven days. On the back on its impending "Merge" upgrade, ETH's relative strength seems to be, technically, breaking bullish.