- Bitcoin has fallen to around $70,000, its lowest level in months, as investors continue shifting capital from cryptocurrency markets into record-breaking U.S. stocks.
- Rising Treasury yields, persistent macroeconomic uncertainty, and large Bitcoin ETF outflows have weakened market sentiment.
- According to Santiment, the growing divergence between Bitcoin and traditional equities is becoming increasingly noticeable, with investors favoring stocks for their stronger returns and lower volatility.
What Does Bitcoin’s MACD Signal Mean for Traders Right Now? Tuesday saw Bitcoin drop to its lowest point in nearly two months as cryptocurrencies continue to diverge from conventional equity markets.
According to TradingView, early on Tuesday, Bitcoin (BTC) dropped to a low of $70k, the lowest level since April 7. This is a daily reduction of more than 4% and a weekly loss of 8%. From its October top of $126,000, Bitcoin has dropped 44%.
While the tech-heavy Nasdaq crested at over 27,000 points on Monday, US stock indices like the S&P 500 reached a record high of just over 7,600 points.
According to Andri Fauzan Adziima, research head at Bitrue Research Institute, some analysts have observed that Bitcoin is currently the only significant asset experiencing a contraction, and the disparity is noteworthy, he told Cointelegraph.
Could Better Macro Conditions Spark A Bitcoin Recovery?
He continued, “It demonstrates that Bitcoin is trading more like a high-beta risk asset linked to macro sentiment rather than an independent hedge.”
This disparity draws attention to present weaknesses, but it also creates the possibility of improved relative performance in the future if macro conditions improve. I see it as a passing stage in the cycle rather than a long-term change.
“The gap between traditional equities and crypto has become increasingly difficult for traders to ignore,” according to an analysis platform, Santiment, on Monday.
It said, “This divergence has led to an increasing preference among investors for stocks over alternative assets like Bitcoin and altcoins.”
Could Extreme Crypto Fear Signal A Bitcoin Rebound?
According to Santiment, the performance disparity across industries can lead to a “self-reinforcing cycle,” and “capital often rotates away from crypto and into stock markets” when traders witness equities continuously producing higher returns with less volatility.
Santiment stated that this trend won’t continue indefinitely and that “mainstream influencers” talking about stock dominance over cryptocurrency is frequently an indication that the public is becoming overly fixated on “equity FOMO and crypto FUD.” It further stated that markets typically move in the opposite direction of what most traders anticipate.
The daily RSI is getting close to oversold territory, having dropped to 34. Despite the lack of a definite bottom, this indicates significant selling pressure.
Accelerating bearish momentum is highlighted by the Moving Average Convergence Divergence indicator, which stays below both its signal line and the zero line.
The present downtrend is deepening rather than consolidating, as evidenced by the ADX’s rise to 25 and its upward trend.
At the 200-week exponential moving average (EMA), which is presently in the $69,000 price range, Bitcoin is getting close to a significant long-term resistance level.
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