Bitcoin likely to drop below $30K, analyst says
According to Katie Stockton, founder and managing partner of Fairlead Strategies, Bitcoin (BTC), the largest cryptocurrency in the world, is likely to fall below $30,000.
Stockton sees Bitcoin’s failure to hold the $40,000 support level as the main bearish catalyst for another painful selloff.
She adds that the cryptocurrency has lost its upward momentum the same way the stock market has. If Bitcoin continues to fall below the key support level, it will likely look like another bear market rather than a corrective phase.
Earlier today, the top cryptocurrency slipped to $38,202 on the Bitstamp exchange, the lowest level since March 15.
At press time, Bitcoin is trading 18% below the yearly opening price after briefly rising above it in late March.
Bitcoin’s smaller peers are also underperforming, with Ethereum (ETH) remaining well below $3,000. Dogecoin is the only cryptocurrency that has managed to buck the trend, spiking more than 12% on reports of Elon Musk being extremely close to acquiring Twitter after hashing out differences with shareholders.
Macro headwinds remain the main culprit for the ongoing correction. By dramatically raising the benchmark short-term interest rate, the Federal Reserve will make it more expensive to borrow money, putting more pressure on risky assets such as Bitcoin.
With cryptocurrencies becoming increasingly intertwined with traditional finance, their correlation with traditional financial assets, such as U.S. equities, continues to increase. The S&P 500 index is currently trading down 1.17% at the time of writing.
