If we look at the price development of Bitcoin in the last 48 hours, there is little movement. After the significant crash in the night from Thursday to Friday, probably mainly caused by the negative news from the crypto bank Silvergate, Bitcoin consolidated in a narrow range.
For example, in the last 24 hours, Bitcoin has traded between $22,250 and $22,464. A brief dip below $22,300 was bought outright. Bitcoin recovered slightly – but the bears keep pushing the price against the important support.
Crypto trader Michael van de Poppe still sees some leeway for Bitcoin. As long as this trades above $21,300 there should not be any major losses. Only below this is the risk that the psychologically important support of $20,000 will be abandoned in the short term.
But what do crypto traders need to know now? What opportunities are there with Bitcoin and is there hope for a countermovement?
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Positive Correlation Fades: Stocks Recover, Cryptos Not – Is the Trend Reversal Coming?
If we look at the connection between the performance of bitcoin and the stock market over the last 12 months, we see a strong positive correlation over long stretches, which submerged again into a negative interaction, primarily around crypto-related events. For example, it was most recently the events surrounding the FTX exchange that caused the stock and crypto markets to be decoupled in November 2022. However, the positive correlation quickly returned and actually moved continuously in this area.
But most recently, the correlation dipped into negative territory. Around the events at Silvergate Bank, stocks were able to recover again at the end of the week after Fed officials eased interest rate fears at least somewhat.
In contrast, cryptos as another risky asset class could not benefit. Because here the threat factors such as Silvergate or SEC are omnipresent. But there may be an opportunity for BTC to outperform the stock market in the short term as a latecomer. The last few months have shown that market participants are digesting such news faster and are turning back to the macro economy.
Should you buy Bitcoin now?
Without a doubt, one could agree with Michael van de Poppe’s thesis. Because it is historically evident that there has almost always been a return to positive correlation in the last 12 months. But this is also possible the other way around – if investors on the stock market acted too euphorically at the end of the week, a dump could also follow here, bringing the positive correlation back without Bitcoin starting a recovery movement.
Anyone who cannot find a suitable Bitcoin setup in the short term, who would like to wait for a directional decision and would rather take a long position in high-risk-reward cryptocurrencies could analyze the historically lucrative market segment of crypto presales.
In the past few weeks, it has been the presale of the Fitness Coins Fight Out and the pre-sale of the eco-friendly cryptocurrency C+Charge, which caused a stir and generated increasing demand from the community. While Fight Out innovatively connects the Metaverse with high-end gyms and disruptively evolves Move-2-Earn, wants C+ batch as an ESG coin, significantly promote the adoption of e-mobility. Price potential seems immanent to both cryptos thanks to a promising idea.
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Author: Daniel Robrecht
After studying law and management, Daniel decided to work as a freelance author and has been writing qualitative publications on various specialist topics for around 10 years now. As an investor, he gained years of experience with stocks & cryptocurrencies. In addition to a long-term investment approach, Daniel is also passionate about short-term markets. Through targeted further training at international universities, he has acquired extensive knowledge about the capital markets, stocks, cryptocurrencies and decentralized finance. Daniel’s primary focus is on general market trends, exciting stocks, business news and the digital currency market. In his private life, too, there is never a day without the financial markets. As an author, Daniel writes for leading German-language publications in this field. Daniel publishes for Finanzen.net, among others, Business2Communityand FXStreet.de. Daniel on LinkedIn.
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