2022-4-29 16:55 |
Bitcoin has failed to strengthen above the $40K again after yesterday’s brief upside that pushed it to highs of $40,280. Today’s market action has seen BTC retreat to lows of $38,750, although the benchmark crypto currently trades just above $39,000 according to data from crypto price tracker CoinGecko.
The negative flip is also being witnessed across the rest of the market, with total market capitalisation down 1.8%. Ethereum, the second-ranked cryptocurrency by market cap is off 1.5% in the past 24 hours.
Recession fears could aid risk assetsCurrent struggles for Bitcoin also align with a slowdown in stocks on Friday as shares of tech giants Amazon and Apple fell after their respective earnings reports a day earlier. The S&P 500 was 1% down in early morning trading, while the Dow Jones Industrial Average had opened 0.4% lower and Nasdaq Composite was losing by 0.7%.
The surge in volatility is likely to elevate further losses amid concerns around US Federal Reserve’s tighter monetary policies. The Fed, which meets next week, is expected to increase interest rates by 50 basis points; a factor that market observers say could impact economic recovery.
Marcus Sotiriou, an analyst at digital asset broker GlobalBlock suggests the possibility that a higher rate hike and overtightening from the Fed could steepen economic decline might present a bullish signal for Bitcoin.
In a note shared via email on Friday, Sotiriou said:
“US GDP contracted by 1.4% in Q1 2022 as recession fears heighten. This is bullish for risk assets like Bitcoin and equities in my opinion, as the Federal Reserve may become less hawkish to avoid a recession.”
The 1.4% year-over-year contraction in the first quarter of 2022 is the first time GDP has shrunk this much since Q2, 2020.
Bitcoin’s immediate outlookNoteworthy for investors though is that the correlation between Bitcoin and stocks has increased over the past several months.
As such, declines across the equity markets arising from jitters around geopolitical turmoil and fresh COVID outbreaks could pull BTC lower.
On the flip side, a spike in upside momentum in the stock market could also help Bitcoin break above immediate resistance levels.
The post Analyst: Recession fears could be bullish for Bitcoin (BTC) appeared first on Coin Journal.
Similar to Notcoin - Blum - Airdrops In 2024
Bitcoin (BTC) на Currencies.ru
|
