The stock market including S&P 500, the Dow and Nasdaq are all plunging more than 3%, Boeing and General Motors more than 5% and Polaris Industries experiencing around 10% crash in the last 24 hours.
Following the stock market crash, bitcoin along with other cryptocurrencies have also started to fall over the last few hours. Yesterday, Bitcoin price was steady above $3900 and traded between $3900 and $4000. As the stock market crashed, the price of bitcoin is on a downfall below $3900 and is currently in a bearish momentum being traded around $3895 (at the time of publishing). The price is expected to fall further.
History of correlation
Last year’s bitcoin and stock market graph shows that after bitcoin experienced an all-time high of $20,000, just a little time after this, the stock market started growing rapidly.
Later in February this year, when bitcoin fell towards $6000, the stock market pattern also looked similar when stocks such as S&P 500 had its worst single-day fall since 2011.
Sentiment plays an important role where traditional assets such as stock and novel assets such as cryptocurrencies correlate.
Bitcoin Price Analysis
Bitcoin is currently being traded at $3895 (at the time of publishing) according to CoinGecko with a major bearish trend line set with resistance close to $3950 which may lead to a further downfall and bitcoin may test the support range of $3600 once again.
Bitcoin is currently experiencing the worst days of the year which started with the bitcoin cash hard fork in November this year when bitcoin was trading around $6500 and crashed down up to $3600 at the end of the month. The price has been trying to recover since then but the resistance around $4000 and $4200 has been creating a hurdle for the price to rise above this range.
As market analysts were previously predicting that the ‘low’ is still not achieved and bitcoin may further fall up to $2500 or even below $2000 this year end, the stock market crash has added fuel to the fire. In the 24 hour chart, there is a bearish trend line created with resistance at $3880 and the support lies around $3800.
This article is not a financial advise. You should do your own research and due diligence before investing or trading in any digital assets.