As a seasoned crypto investor, I’ve seen my fair share of market volatility and price fluctuations. The recent correlation between Bitcoin’s performance and that of tech stocks like Nvidia has left me feeling uneasy. It seems that the popular narrative surrounding Bitcoin as a store of value is being challenged once again.
As a researcher examining the financial markets, I’ve noticed an intriguing correlation between the recent downturn in Bitcoin, the leading cryptocurrency, and the decline in stocks of companies like Nvidia (NVDA), which specialize in artificial intelligence (AI) technologies. It appears that these two sectors may be experiencing some interconnected challenges, but further investigation is required to fully understand the underlying causes.
According to Michael Santoli, CNBC’s senior markets commentator, Bitcoin’s behavior challenges the widely-held notion that it functions effectively as a store of value, frequently advocated by its supporters.
Since the middle of 2023, Bitcoin has been seen as a noteworthy investment opportunity, alongside stocks in artificial intelligence, according to Santoli’s perspective.
According to U.Today’s report, Bitcoin exhibited a negative correlation with stocks during April, offering investors an opportunity to diversify their portfolios. However, the cryptocurrency is currently experiencing selling pressure in tandem with other risk assets due to mounting fears of stagflation. If the US Federal Reserve decides against implementing rate cuts this year as a result, it could lead to a bearish outlook for Bitcoin.
Is Bitcoin already in the bear market?
Beginning May with yet another significant price decrease, Bitcoin experienced its largest monthly drop since August 2023 in the previous month.
As a researcher studying the cryptocurrency market, I’ve observed that the flagship digital currency is presently transacting at an average price of $57,904 across major spot exchanges. Earlier today, it experienced a noticeable dip and touched a low of $56,637 before rebounding to its current value.
Pessimistic investor Peter Schiff has declared that Bitcoin is undoubtedly in a bear market, contradicting the excitement generated by Bitcoin ETF news. He expressed this viewpoint on social media platform X with the comment: “Turn off the lights #HODLers, the party has ended.”
Currently, Bitcoin ETFs like BlackRock’s IBIT are trading at a discount of 1.7% relative to their net asset value, as reported by Bloomberg on April 30th.
The largest cryptocurrency is still up roughly 36% on a year-to-date basis.
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2024-05-01 21:46