The link S&P 500 has with Bitcoin, has snowballed recently. The aforementioned increase may not be appropriate putting into consideration that stocks,. Gold and equities are selling off more than ten years ago when United States rates was at 1.5%. However, some people have observed that the aforementioned link over the past weeks have prompted the price action of Bitcoin’s rangebound.
A critical evaluation of the price chart of Bitcoin, price chart, will that the current trend is the same with when the price of Bitcoin was dropped to 26%. Based on the aforementioned drop, the value of Bitcoin, has been said to have bottomed out in a month.
Therefore, the increase in the correlation of Bitcoin and S&P 500 is showing a despairing turn in the price action of Crypto currency.
However, while the rise of bitcoin is bearish, the curve of adoption is said to be bullish. The number of on chain users of Bitcoin is increasing tremendously and it is at the same rate with the final 2017 bull weeks. Also, the increase in the number if uses if bitcoin is glaring on its exchanges and there are plethora of users.
Also, there is a likelihood that demand for Bitcoin exchanges will increase and remove the current pressure off based on a similar bull market in 2017. The increase in users of Bitcoin snowballed in 2021, January and with the same Bitcoin mempool transactions also.
The owing of Grayscale of 11% discount on NAV, may impact positively on the price of Bitcoin above the $50,000 psychological hurdle, because in the long run there will be a demand for retail, in addition institutions buying Bitcoin.
Presently, there is 60% rise in the price of cryptocurrencies, which started at the inception of 2021. The aforementioned has been sustained in myriads of corrections post the e $58,000-level, however, there is a strong support back up at the $45,000 level, since the time when a remarkably number of institutions acquire Bitcoin higher than the price.
However, buying through local bottoms has lowered the average price for institutional buyers like MicroStrategy and Grayscale.
In fact, MicroStrategy’s average price per Bitcoin has dropped to $24,119 according to Michael Saylor’s latest tweet. If Bitcoin’s correlation with S&P 500 drops over the following week, it may be a positive sign for the price.