• Market Cap: $1,089,351,806,345.48
  • 24h Vol: $81,625,628,226.69
  • BTC Dominance: 45.79%
XBT.Market
Advertisement
  • Home
  • Coins MarketCap
  • Crypto Exchanges
  • Crypto Calculator
  • Top Gainers and Loser
  • News
  • Contact Us
No Result
View All Result
XBT.Market
No Result
View All Result
Home Bitcoin

How Bitcoin’s strong correlation to stocks could trigger a drop to $8,000

Jon Hartney by Jon Hartney
July 13, 2022
in Bitcoin, Blockchain, Business, Market
0
How Bitcoin’s strong correlation to stocks could trigger a drop to $8,000
189
SHARES
1.5k
VIEWS
Share on FacebookShare on Twitter

The absence of a CME Bitcoin futures premium, unrelenting record-high inflation and investor concerns over the economy are all factors weighing on BTC price.

The Bitcoin (BTC) price chart from the past couple of months reflects nothing more than a bearish outlook and it’s no secret that the cryptocurrency has consistently made lower lows since breaching $48,000 in late March.

Bitcoin price in USD. Source: TradingView

Curiously, the difference in support levels has been getting wider as the correction continues to drain investor confidence and risk appetite. For example, the latest $19,000 baseline is almost $10,000 away from the previous support. So if the same movement is bound to happen, the next logical price level would be $8,000.

Related articles

OpenAI CEO highlights South Korean chips sector for AI growth, investment

OpenAI CEO highlights South Korean chips sector for AI growth, investment

June 10, 2023
Nigeria to tax crypto, digital assets 10% on capital gains: Experts react

Nigeria to tax crypto, digital assets 10% on capital gains: Experts react

June 10, 2023

Traders are afraid of regulation and contagion

On July 11, the Financial Stability Board (FSB), a global financial regulator including all G20 countries, announced that a framework of recommendations for the crypto sector is expected in October. The FSB added that international regulators need to supervise crypto markets in line with the principle of “same activity, same risk, same regulation.”

In a written speech on July 12, Jon Cunliffe, deputy governor for financial stability at the Bank of England, said that crypto is somehow over and it should not be a concern anymore. Cunliffe added: “innovation has to happen within a framework in which risks are managed.”

To date, investors still haven’t figured out the total losses from deposits on crypto lenders Celsius and Voyager Digital, and both firms continue to seek either a recovery plan or bankruptcy. According to Voyager, the firm still holds $650 million worth of “claims against Three Arrows Capital,” so the exact numbers of customer assets remain unknown.

The negative newsflow is reflected in the CME’s Bitcoin futures contracts premium. This data measures the difference between longer-term futures contracts and the current spot prices in regular markets.

Whenever this indicator fades or turns negative, this is an alarming red flag. This situation is also known as backwardation and indicates that bearish sentiment is present.

BTC CME 1-month forward contract premium vs. Coinbase/USD. Source: TradingView

These fixed-month contracts usually trade at a slight premium, indicating that sellers are requesting more money to withhold settlement for longer. As a result, futures should trade at a 0.25%–0.75% premium in healthy markets, a situation known as contango.

Notice how the indicator has stood below the “neutral” range since early April, since Bitcoin failed to sustain levels above $45,000. The data shows that institutional traders are unwilling to open leverage long positions, although it is not yet a bearish structure.

Macroeconomic fears are preventing investors from trading crypto

Exchange-provided data highlights traders’ long-to-short net positioning. By analyzing every client’s position on the spot, perpetual and futures contracts, one can better understand whether professional traders are leaning bullish or bearish.

There are occasional discrepancies in the methodologies between different exchanges, so viewers should monitor changes instead of absolute figures.

Exchanges top traders Bitcoin long-to-short ratio. Source: Coinglass

Despite Bitcoin’s 11% correction from July 9 to 12, top traders have increased their leverage longs. The long-to-short ratio at Binance remained relatively flat at 1.13, while the top traders at Huobi started at 0.95 and finished the period at 0.93. However, this impact was more than compensated by OKX traders increasing their bullish bets from 1.09 to 1.32.

Related: The search term ‘Bitcoin Crash’ is trending — Here’s why

The lack of a premium in the CME futures contract is not concerning because Bitcoin is struggling with the $20,000 resistance. Furthermore, top traders on derivatives exchanges have increased their longs despite the 11% price drop in three days.

Regulatory pressure is unlikely to recede in the short term and at the same time, there’s not much that the Federal Reserve can do to suppress inflation without triggering some form of an economic crisis. For this reason, pro traders are not rushing to buy the dip because Bitcoin’s correlation to traditional assets remains high.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

Read Entire Article
Tags: CointelegraphCryptocurrencyInvestmentMining Bitcoin
Share76Tweet47

Related Posts

OpenAI CEO highlights South Korean chips sector for AI growth, investment

OpenAI CEO highlights South Korean chips sector for AI growth, investment

by Jon Hartney
June 10, 2023
0

Sam Altman confirmed ongoing discussions with chipmaking companies like Samsung Electronics and expressed his

Nigeria to tax crypto, digital assets 10% on capital gains: Experts react

Nigeria to tax crypto, digital assets 10% on capital gains: Experts react

by Jon Hartney
June 10, 2023
0

The Act aims to enhance fiscal transparency, boost revenue and recognize cryptocurrencies as legitimate assets

Ooki DAO to shut down after ‘precedent setting’ court battle with CFTC

Ooki DAO to shut down after ‘precedent setting’ court battle with CFTC

by Jon Hartney
June 10, 2023
0

The CFTC highlighted that “critically, in a precedent-setting decision” the Ooki DAO was held in court as

Scammers steal nearly $1M after hijacking 8+ prominent crypto twitter accounts

Scammers steal nearly $1M after hijacking 8+ prominent crypto twitter accounts

by Jon Hartney
June 10, 2023
0

The group of scammers have recently taken over accounts belonging to the founder of Pudgy Penguins, the CTO of OpenAI

SEC charges against Binance and Coinbase are terrible for DeFi

SEC charges against Binance and Coinbase are terrible for DeFi

by Jon Hartney
June 10, 2023
0

The SEC’s charges against Binance and Coinbase could have far-reaching consequences for decentralized finance

Load More
  • Trending
  • Comments
  • Latest
NEXO risks 50% drop due to regulatory pressure and investor concerns

NEXO risks 50% drop due to regulatory pressure and investor concerns

September 30, 2022
51% of Ethereum blocks are now compliant with OFAC standards, raising censorship concerns

51% of Ethereum blocks are now compliant with OFAC standards, raising censorship concerns

October 14, 2022
All aboard! Elon Musk’s Vegas Loop now taking Dogecoin payments

All aboard! Elon Musk’s Vegas Loop now taking Dogecoin payments

July 7, 2022
Zero-knowledge KYC could solve the privacy vs compliance conundrum: VC partner

Zero-knowledge KYC could solve the privacy vs compliance conundrum: VC partner

October 11, 2022
All aboard! Elon Musk’s Vegas Loop now taking Dogecoin payments

All aboard! Elon Musk’s Vegas Loop now taking Dogecoin payments

0
Crypto owners banned from working on US Government crypto policies

Crypto owners banned from working on US Government crypto policies

0
Korean startup Uprise lost $20M shorting LUNC

Korean startup Uprise lost $20M shorting LUNC

0
Ethereum testnet Merge mostly successful — ‘Hiccups will not delay the Merge.’

Ethereum testnet Merge mostly successful — ‘Hiccups will not delay the Merge.’

0
OpenAI CEO highlights South Korean chips sector for AI growth, investment

OpenAI CEO highlights South Korean chips sector for AI growth, investment

June 10, 2023
Nigeria to tax crypto, digital assets 10% on capital gains: Experts react

Nigeria to tax crypto, digital assets 10% on capital gains: Experts react

June 10, 2023
Ooki DAO to shut down after ‘precedent setting’ court battle with CFTC

Ooki DAO to shut down after ‘precedent setting’ court battle with CFTC

June 10, 2023
Scammers steal nearly $1M after hijacking 8+ prominent crypto twitter accounts

Scammers steal nearly $1M after hijacking 8+ prominent crypto twitter accounts

June 10, 2023

XBT.Market

This website is an automated news feed powered by the Nebulome cloud system. The site is made possible by YYC TECH Consulting and Alberta Digital Mining Company. As a team with major crypto and bitcoin enthusiasm, we have curated major sources of news, trading and financial data to bring you, our viewer, an unbiased source of truth.

Recent Posts

  • OpenAI CEO highlights South Korean chips sector for AI growth, investment June 10, 2023
  • Nigeria to tax crypto, digital assets 10% on capital gains: Experts react June 10, 2023
  • Ooki DAO to shut down after ‘precedent setting’ court battle with CFTC June 10, 2023
  • Scammers steal nearly $1M after hijacking 8+ prominent crypto twitter accounts June 10, 2023
  • SEC charges against Binance and Coinbase are terrible for DeFi June 10, 2023

News Categories

  • Bitcoin
  • Blockchain
  • Business
  • Market

Tags

bitcoinMagzine Cointelegraph Cryptocurrency insidebitcoins Investment Mining Bitcoin NewsBTC

Quicklinks

  • Home
  • Coins MarketCap
  • Crypto Exchanges
  • Crypto Calculator
  • Top Gainers and Loser
  • News
  • Contact Us

© 2022 Xbt.Market - Powered by YYC Tech Consulting & ADMCO.

No Result
View All Result
  • Home
  • Coins MarketCap
  • Crypto Exchanges
  • Crypto Calculator
  • Top Gainers and Loser
  • News
  • Contact Us

© 2022 Xbt.Market by Nebulome.

  • bitcoinBitcoin(BTC)$25,716.00-3.40%
  • ethereumEthereum(ETH)$1,746.73-5.36%
  • USDEXUSDEX(USDEX)$1.07-0.53%
  • tetherTether(USDT)$1.00-0.07%
  • binancecoinBNB(BNB)$238.97-8.36%
  • usd-coinUSD Coin(USDC)$1.00-0.01%
  • rippleXRP(XRP)$0.497695-6.26%
  • staked-etherLido Staked Ether(STETH)$1,745.97-5.28%
  • cardanoCardano(ADA)$0.250111-21.50%
  • dogecoinDogecoin(DOGE)$0.060095-11.69%
  • tronTRON(TRX)$0.068084-13.03%
  • solanaSolana(SOL)$14.91-22.72%
  • litecoinLitecoin(LTC)$77.50-12.43%
  • polkadotPolkadot(DOT)$4.48-10.88%
  • matic-networkPolygon(MATIC)$0.59-25.48%
  • binance-usdBinance USD(BUSD)$1.00-0.04%
  • daiDai(DAI)$1.000.04%
  • wrapped-bitcoinWrapped Bitcoin(WBTC)$25,766.00-3.31%
  • avalanche-2Avalanche(AVAX)$11.64-16.46%
  • shiba-inuShiba Inu(SHIB)$0.000007-16.36%
  • leo-tokenLEO Token(LEO)$3.510.21%
  • uniswapUniswap(UNI)$4.00-13.54%
  • chainlinkChainlink(LINK)$5.06-15.75%
  • Aerarium FiAerarium Fi(AERA)$7.14-13.11%
  • okbOKB(OKB)$41.52-7.66%
  • moneroMonero(XMR)$137.04-4.14%
  • cosmosCosmos Hub(ATOM)$7.95-15.12%
  • ToncoinToncoin(TON)$1.48-12.91%
  • stellarStellar(XLM)$0.081467-6.66%
  • ethereum-classicEthereum Classic(ETC)$14.60-14.27%
  • true-usdTrueUSD(TUSD)$1.000.04%
  • bitcoin-cashBitcoin Cash(BCH)$101.29-8.87%
  • internet-computerInternet Computer(ICP)$3.81-10.05%
  • lido-daoLido DAO(LDO)$1.85-16.71%
  • quant-networkQuant(QNT)$104.16-4.70%
  • GGTKNGGTKN(GGTKN)$0.1121180.75%
  • filecoinFilecoin(FIL)$3.36-17.93%
  • hedera-hashgraphHedera(HBAR)$0.044587-8.77%
  • crypto-com-chainCronos(CRO)$0.051574-11.67%
  • ArbitrumArbitrum(ARB)$1.02-10.40%
  • AptosAptos(APT)$6.00-22.29%
  • nearNEAR Protocol(NEAR)$1.22-14.73%
  • vechainVeChain(VET)$0.015145-12.72%
  • paxos-standardPax Dollar(USDP)$1.000.06%
  • fraxFrax(FRAX)$1.00-0.01%
  • EdgecoinEdgecoin(EDGT)$1.00-0.03%
  • BSCEXBSCEX(BSCX)$238.1967.14%
  • the-graphThe Graph(GRT)$0.095968-14.55%
  • apecoinApeCoin(APE)$2.35-18.82%
  • rocket-poolRocket Pool(RPL)$44.40-6.52%
  • Rocket Pool ETHRocket Pool ETH(RETH)$1,878.15-5.19%
  • algorandAlgorand(ALGO)$0.108996-13.12%
  • elrond-erd-2MultiversX(EGLD)$30.45-12.84%
  • aaveAave(AAVE)$52.87-12.18%
  • render-tokenRender(RNDR)$2.06-12.57%
  • eosEOS(EOS)$0.68-23.91%
  • usddUSDD(USDD)$1.00-0.20%
  • blockstackStacks(STX)$0.52-17.89%
  • the-sandboxThe Sandbox(SAND)$0.380510-21.42%
  • optimismOptimism(OP)$1.09-21.05%
  • WhiteBIT TokenWhiteBIT Token(WBT)$4.72-2.06%
  • tezosTezos(XTZ)$0.72-13.69%
  • Bitget TokenBitget Token(BGB)$0.477934-3.85%
  • fantomFantom(FTM)$0.239385-18.67%
  • theta-tokenTheta Network(THETA)$0.64-15.80%
  • BitDAOBitDAO(BIT)$0.440905-8.09%
  • radixRadix(XRD)$0.061385-8.93%
  • CloutContractsCloutContracts(CCS)$52.461,000.00%
  • decentralandDecentraland(MANA)$0.339206-19.36%
  • kucoin-sharesKuCoin(KCS)$6.32-6.32%
  • immutable-xImmutableX(IMX)$0.61-16.74%
  • axie-infinityAxie Infinity(AXS)$4.98-19.80%
  • gemini-dollarGemini Dollar(GUSD)$1.00-0.02%
  • havvenSynthetix Network(SNX)$1.79-13.20%
  • curve-dao-tokenCurve DAO(CRV)$0.64-15.56%
  • makerMaker(MKR)$595.63-5.45%
  • gatechain-tokenGate(GT)$3.86-6.41%
  • neoNEO(NEO)$7.51-17.88%
  • flowFlow(FLOW)$0.51-19.64%
  • marumaruNFTmarumaruNFT(MARU)$0.24991121.40%
  • terra-lunaTerra Luna Classic(LUNC)$0.000087-10.58%
  • bittorrentBitTorrent(BTT)$0.000001-0.96%
  • galaGALA(GALA)$0.020822-19.59%
  • pax-goldPAX Gold(PAXG)$1,910.08-1.14%
  • tether-goldTether Gold(XAUT)$1,959.38-0.31%
  • xdce-crowd-saleXDC Network(XDC)$0.034652-2.74%
  • bitcoin-cash-svBitcoin SV(BSV)$24.87-17.97%
  • injective-protocolInjective(INJ)$5.94-15.59%
  • casper-networkCasper Network(CSPR)$0.041720-5.21%
  • binaryxBinaryX(BNX)$165.90-5.97%
  • Tokenize XchangeTokenize Xchange(TKX)$5.74-6.92%
  • compound-ethercETH(CETH)$35.03-5.47%
  • klay-tokenKlaytn(KLAY)$0.146998-11.11%
  • kavaKava(KAVA)$0.80-16.04%
  • Halo CoinHalo Coin(HALO)$0.057345-0.05%
  • huobi-tokenHuobi(HT)$2.67-6.80%
  • iotaIOTA(MIOTA)$0.153924-13.94%
  • ShardusShardus(ULT)$1.09269.54%
  • compound-usd-coincUSDC(CUSDC)$0.022869-0.11%
  • gmxGMX(GMX)$45.33-12.26%