The correlation between bitcoin and a US tech stock indicator has hit a two-year high, suggesting that the stock market's reaction to US inflation data due later on Wednesday could set the tone for digital tokens. Data compiled by Bloomberg shows a 30-day correlation coefficient between the largest cryptocurrency and the Nasdaq 100 index of about 0.70. A correlation coefficient of 1 indicates that the asset is moving in the same direction, and a negative 1 indicates that the asset is moving in the opposite direction. The inflation report is expected to show solid price pressure just as markets are concerned about the scope for the Federal Reserve to cut interest rates further amid a strong U.S. economy and uncertain implications for Donald Trump's agenda. Against this backdrop, bond yields and the dollar rose while stocks and cryptocurrencies came under pressure. As of 9:21 a.m. Singapore time on Wednesday, bitcoin was trading at $96,900, about $11,500 below last month's all-time high.