There was a time when bitcoin was touted as an inflation hedge. We can put that to bed as today's high CPI report has led to a 7.5% rout in bitcoin. It has so far left an ugly outside day on the daily chart that's chewing into the big jump on September 9.

Bitcoin daily chart

The only thing bitcoin has shown a correlation with this year is the Nasdaq. It's proven to be a good forerunner of sentiment but ultimately it's the economy and the Fed in charge. Today's hot CPI report has caused a rout in equities with the Nasdaq down 4% and testing session lows.

The crypto trade lately has been around the ethereum merge on Thursday. Those kinds of trades have been of the sell-the-fact variety frequently in the space. This time it looks like the flush is coming early.