Crypto analyst warns Bitcoin could see massive depreciation as stock markets print fresh 2022 lows
A closely followed crypto strategist and trader is warning bitcoin holders that BTC could witness a major capitulation event amid stock market weakness.
Pseudonymous trader Cantering Clark tells his 146,700 Twitter followers that Bitcoin could see a nearly 40% drop from current levels if the S&P 500 (SPX) continues its bearish trajectory.
“If the S&P 500 falls into the next major region between 3200-3400 [points]I think the correct assumption would be that crypto beta would be at least 2-3x that, which at least means bitcoin is retesting the bar of the node with the highest volume in the last five years – so around US$12k-US13k -Dollar.
I know people will be citing idiosyncratic strength lately, which has been remarkable, but once the SPX starts dragging down multi-sigma moves in a short space of time, all risk assets fall in sync.”
Source: Cantering Clark/Twitter
On Friday, the S&P 500 closed at 3,585.61 points, 1.39% below its previous 2022 low of 3,636 points, which was printed in June.
In the short-term, however, Cantering Clark says that bitcoin bulls could inspire some confidence if they manage to reclaim the $20,000 price area.
“If we can break these local highs, I think bitcoin will see some momentum build up.”
Pseudonymous analyst Jack also shares Cantering Clark’s outlook on BTC. According to Jack, Bitcoin is likely to develop bullish momentum if it surges above $20,000.
“I can be a bear all I want, but if that jumps over the creek, it’s a damn good setup for too long and a good reason to part with the narrative and play the technique instead.”
At the time of writing, Bitcoin is changing hands at $19,323, flat rate per day.
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