Bitcoin price gave up its recent gains as concerning signals from the US economy continue to weigh on investor sentiment.
Bitcoin price holds steady as S&P 500 plunges to 110-day low
The S&P 500 dropped to a 110-day low as the market digests what “higher for longer” means for stocks. Will Bitcoin begin to chart its own path?
Do Bitcoin halvings spark BTC price rallies, or is it US Treasurys?
An intriguing chart shows a close relationship between U.S. 10-year Treasurys and Bitcoin halving price rallies.
What are the 3 assets most correlated with Bitcoin?
Bitcoin price is closely linked to several financial assets but the reasons for correlation with certain precious metals and stocks can be quite different.
Can Bitcoin repeat a 2017-like rally as dollar correlation reverses?
The Dollar Index disconnect from Bitcoin does not necessarily mean that BTC price is about to experience a big rally, historic data suggests.
US Treasury yields are rising — What does it mean for Bitcoin price?
The 5-year U.S. Treasury yield reached its highest level in 3 months, but the typical inverse correlation-based price action with Bitcoin might not work this time.
Crypto’s downturn is about more than the macro environment
The global economic downturn should not have a long-term negative effect on cryptocurrency prices, even if it is influencing crypto in the short term.
Data challenges the DXY correlation to Bitcoin rallies and corrections ‘thesis’
Analysts and traders strongly adhere to the “Bitcoin is inversely correlated to the strength of the U.S. dollar index” thesis, but a closer look at the data suggests otherwise.
Bitcoin derivatives show a lack of confidence from bulls
High correlation to stock markets and recession risks limit optimism on the part of BTC investors.
Ethereum price falls below $1.1K and data suggests the bottom is still a ways away
ETH price has stalled around the $1,100 level, but several data points suggest the altcoin’s sell-off is far from complete.
$32K Bitcoin price could turn the tides in Friday’s $160M BTC options expiry
BTC price lost the momentum that pushed it to $32,300 on May 31, but this week’s option expiry could help bulls recapture the key price level.
Bitcoin traders say $34K was the bottom, but data says it’s too early to tell
Bitcoin traders say the bottom is in, but it’s important to also consider BTC’s correlation to equities markets.
Pantera Predicts Correlation Between Bitcoin And Traditional Markets Might Break This Spring
In a recent call with investors, executives from the crypto hedge fund Pantera Capital said they believe DeFi assets such as Ethereum could soon break out of their current correlation to traditional macro markets. The market has seen increasing similarities between these two spaces recently. But there’s no guarantee it will continue or even last for very long at all, given how quickly things change in this industry.
Pantera Capital believes the crypto market will be able to “decouple” traditional macro assets even when interest rates go up.
In the interview on February 1, CEO Dan Morehead and co-chief investment officer Joey Krug both said they believe this transition is happening now. Institutional investors are entering the space, leading them away from stocks or bonds into cryptocurrencies like Bitcoin and other related technologies like the blockchain 2030 panel discussion.
Related Reading | Top 5 Watershed Moments In BTC On-Chain Analysis’ History. Is Your Favorite In?
Pantera Capital Management shared the details from their recent call with investing public on Wednesday this week in a new Blockchain Letter.
Crypto is starting to break from its traditional correlation with macro assets. According to Krug, history has shown that when the former goes down for 70 days before decoupling and trade on its own again over weeks – as we expect soon enough!– crypto’s becoming more resilient by leaps and bounds.
Krug explained;
It doesn’t guarantee that it won’t go down a lot more next month or whenever, but it just means the odds are high that the markets are at an extreme and will bounce back relatively quickly.
Pantera Capital Predictions Proved In the Past
Since February 2021, when BTC traded at around USD 47 thousand after correcting 20% in a week, Krug predicted that “a bitcoin rally might be back by April if not sooner.” The price then increased to over $63,000 before starting intense downturns, bringing its sizes below $30,000.
Bitcoin struggling to maintain $40,000 mark value | Source: BTC/USD Chart of Tradingview.com
Krug said that he does not think the prices for many digital assets are too high right now, with some DeFi tokens trading at P/E multiples ranging from 10-40. They have moderate value; tech stocks go up to 500x turnover rates.
This time around, he further explained why investors shouldn’t worry about over-investing in cryptocurrency or finance. Despite recent crashes caused by several governments imposing restrictions on bank transactions involving Bitcoin (BTC).
Related Reading | Bitcoin Dives To $40K, What Could Trigger More Downsides
P/E (price-to-earnings) ratio is a standard tool used to value stocks and can be found by dividing the market value per share (or token) of an individual company’s portfolio by its annual earnings.
Krug added;
It’s my personal view that USD 2,200 ETH was likely the bottom.
Pantera CEO says you need to consider the cash flow when discounting an asset’s value, which means lower prices if yield rates are higher.
Analysts Reviews
Crypto is not just a thing of value; it’s also an investment. Just as with gold, many factors determine its price and worth. Volatility is one such factor, supply vs. demand within different markets worldwide. As a result, the element can impact how much people want to buy or sell at any given moment in time.
The Pantera CEO said;
It can behave in a very different way from interest-rate-oriented products. I think when all’s said and done, investors will be given a choice. They have to invest in something, and if rates are rising, blockchain is going to be the most relatively attractive.
With tensions rising throughout Europe and Asia, it is expected that inflation will be at an all-time high in 2022. This could give bitcoin (BTC) a valuable hedge against volatility. In addition, provide stability for other digital assets like ethereum or Litecoin during their respective peaks next year.
Bitcoin “remains hesitant,” according to an analyst at GlobalBlock. The bitcoin price has been trading lower recently and did not participate in the futures’ recent rally. However, they are still selling off more than usual compared with spot prices which have dipped even further down over this last week or so.
Marcus Sotiriou, a GlobalBlock analyst, added;
This suggests that this price rise was driven by speculation or hedging rather than genuine demand.
Here’s why Bitcoin traders shouldn’t overanalyze US inflation data
Analysts say record high inflation in the United States is impacting crypto market momentum, but is the impact of the data overstated to the detriment of investors?
Here’s why Bitcoin might be safe from a global stock market crisis
BTC’s lack of integration with traditional finance and its inability to be forcefully sold to cover financial losses mean the price might not ‘collapse’ if there is a global stock market meltdown.
Data suggests the strong US dollar makes Bitcoin weaker argument is flawed
Analysts and traders are linking Bitcoin’s bearish turn with the growing strength of the U.S. dollar, but data suggests otherwise.
2 Bitcoin price indicators suggest BTC has not bottomed yet
Traders are using a variety of strategies to determine whether Bitcoin price has bottomed, but on-chain activity and derivatives data hint that the situation remains precarious.