Why Crypto Is “Likely To Dump” As It Lags The S&P 500, Expert Says
June 28 2022 - 12:20PM
NEWSBTC
Bitcoin remains stuck at its current levels. The number one
cryptocurrency has been unable to push upwards and could be in
danger of revisiting its yearly lows. Related Reading
| Outflows Rock Bitcoin As Institutional Investors Pull The
Plug, More Downside Coming? At the time of writing, Bitcoin
trades at $20,700 with sideways movement in the last 24 hours and
the past week. According to crypto analyst Justin Bennett, Bitcoin
is hinting at further losses. The cryptocurrency stayed rangebound
even as the traditional market rallied. Bitcoin has displayed a
high correlation with traditional equities. In particular, the
price of Bitcoin seems to be moving in tandem with the Nasdaq 100
and the S&P 500 Index. However, this dynamic has been changing
in short timeframes making BTC a lagger as equities trend upwards.
Bennett believes this is an indicator of a fakeout, a false upwards
movement before a re-test of previous support. At the moment, the
analyst claims, there is nothing more important for BTC’s price
than equities. Via Twitter, Bennett wrote the following and shared
the chart below: Everything for #crypto boils down to this…Does the
S&P 500 fail to hold above 3,880? If so, and we get a 1h close
below, this latest rally becomes a fakeout, and we likely get the
next leg lower for stocks and crypto alike. Everything else is just
noise. You could literally trade BTC using nothing but the S&P
chart above. As of now, it looks like this level will fail. As seen
in the chart above, the S&P 500 broke below a major trendline
and seems to be heading towards critical support at 3,800. Bitcoin
seems to be holding its levels despite the S&P 500 price
action, but Bennett ruled out the possibility of a “fakeout” due to
the overall weakness in the market. I've seen a few comments
stating that this could be a fakeout. The fakeout to the upside
already occurred. The last 1h close confirmed it. No guarantees,
but fakeouts of fakeouts are rare. pic.twitter.com/GQjKCwzRm9 —
Justin Bennett (@JustinBennettFX) June 28, 2022 Bitcoin Levels To
Watch In Case Of Further Losses Data from Material Indicators shows
liquidity on crypto exchange Binance has been constantly moving
around current levels. There are over $30 million in bids orders
below BTC’s price which could provide important support. However,
as seen below, asks orders to have been swelling which could
prevent BTC’s price to break above $21,000 and get out of the
danger zone. Analysts from Material Indicators identified the
levels between $17,000 and $19,000 as the next potential area for
Bitcoin. Related Reading | Glassnode Deems 2022 Bear Market As
The Most Atrocious For BTC And All Cryptocurrencies At those
levels, there are important pools of liquidity, and the price of
Bitcoin tends to trend towards these levels. The analyst added:
This looks like a ladder of #BTC bids that intends to get filled.
Time will tell if it gets filled where it rests or if it needs to
adjust closer to the active trading range.
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