Can Bitcoin price hold $24K as stocks correlation hits lowest since 2021?
2023.02.22 08:40
Bitcoin (BTC) wicked to five-day lows on Feb. 22 as a comedown for United States equities continued.
BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView
Analyst on Bitcoin: “Waiting for a bit lower”
Data from Cointelegraph Markets Pro and TradingView recorded lows of $23,871 on Bitstamp, with S&P 500 futures slipping under 4,000 ahead of the Wall Street open.
Bitcoin bulls had lost ground after the U.S. holiday weekend, which ended in weakness across equities and a failed attempt to flip $25,000 to support.
For Cointelegraph contributor Michaël van de Poppe, who hoped the correction would be short-lived, it was time to wait and see.
“Markets correcting as U.S. indices are also correcting at this point. This means, opportunities!” he told Twitter followers on the day.
“I think I’ll be waiting for a bit lower on Bitcoin to get triggered for a long position.“
Van de Poppe had previously forecast a move to as high as $40,000 for BTC/USD before a correction set in, potentially shaving 50% off that high.
Meanwhile, Dylan LeClair, senior analyst at UTXO Management, warned that a “crisis” between stocks and U.S. bonds continued to play out.
“Bonds rolling over over the past month served as a flashing alarm for a reversal, during which equities became the most expensive relative to bonds since before the GFC, as 2021 bubble favorites led the rally,“ part of a Twitter thread read.
Another post nonetheless noted that Bitcoin’s correlation to stocks was at its lowest since late 2021 but “still very much positive.“
“I am quite interested to see how bitcoin trades during the next risk off move in legacy markets… Let’s see,“ LeClair added.
Macro asset vs. Bitcoin correlation annotated chart. Source: Dylan LeClair/ Twitter
Binance “Notorious B.I.D.” gets filled
Within Bitcoin, attention still focused on a sizable bid wall, which had moved the spot price by shifting itself around the Binance order book in recent days.
Related: Bitcoin active addresses ‘concern’ analyst despite 50% BTC price gains
Dubbed the “Notorious B.I.D.” by monitoring resource Material Indicators, the bid liquidity met spot price head-on as Bitcoin dipped, with bids getting filled.
Switched to Absolute CVD Value to confirm that the Notorious B.I.D. wall was filled. #FireCharts pic.twitter.com/4TutHr01Bh
— Material Indicators (@MI_Algos) February 22, 2023
With support thus removed from the order book, Material Indicators added in accompanying comments that it would be “very happy” if BTC/USD were to now continue downward to $21,500.
“The bid wall got filled. Liquidity hasn’t stopped moving around the order book long enough to analyze. Waiting for it to settle down,” another post stated.
