Yesterday financial markets showed first severe bearish signs. An intraday reversal for the NASDAQ and other US indices signaled waning confidence in current rich stock valuations. The long-term weekly chart (QQQ) still looks okay, but the macro-economics don’t.
After the Fed suggested to finally stop the money printing during the next months, economists are asking if that may be too late to stop inflation or even stagflation.
Bitcoin tried to bounce earlier and failed miserably. Gone are the days where people dreamt Bitcoin is a safe haven. Since the pandemic crash almost two years ago, the correlation between stocks and crypto becomes highly positive on every negative occasion.
Bitcoin crashed through an important support line at 40K (red).
Some days earlier crypto whales touted that institutional interest will return at 38-39K — that’s were Bitcoin stands right now. Let’s see if that happens, or if it was just a psychological attempt to boost Bitcoin so that it does not penetrate this important support line.
Comparing stocks with crypto, the latter look weaker in this weekly chart that starts with the pandemic crash.
Conclusion: If stocks enter a bear market, expect much more pain for Bitcoin and the altcoins. But then, some sunny day crypto will rise again like Phoenix from the ashes…
If you are interested in the right altcoins to ride then, stay tuned.