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Bitcoin price surges, potentially ending 9 weeks of straight losses

Posted: 1 June 2022 3:24 am
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Bitcoin (BTC) failed to rally with tech stocks last week, but today’s surge may give investors hope.

  • BTC rose 8% before correcting, leaving it up 6% on the week at the time of writing.
  • While the two markets have been correlated recently, Nasdaq gained approximately 7% last week while Bitcoin lost 5.5%.
  • Despite declining 54% since its all-time high, BTC is only down 15% compared to one year ago.

Bitcoin has been ascending since May 30, rising from $29,300 to a relative high of $32,200 before recording a minor correction. At press time, BTC is trading at $29,870.

Before its ongoing upward movement, Bitcoin had seen nine consecutive weeks of price losses, its highest since late 2014. Analysts believe that if stock prices continue to remain in the red — with the S&P 500 and Nasdaq Composite both losing over a percent over the past day — the digital asset could float above $32K, even hitting $37K.

For a full bull market to resume, experts believe Bitcoin will soon have to hit a price point of $44K. If that happens, BTC can trigger a breakout and potentially retest its all-time highs.

How to buy Bitcoin

BTC decoupling from stocks, but not as hoped

Last week, the tech-heavy index Nasdaq closed at a profit of 6.7% as the Federal Reserve noted that it might not have to increase interest rates as aggressively as many investors had previously feared. Higher interest rates have a direct impact on the purchasing power of an individual. If rates are high, people tend to invest less across various markets.

This positive news was not mirrored by the crypto market, with the price of BTC slipping by 5.5% between May 23 and 29. The drop was likely compounded by news of the recent Terra Luna debacle, which independent analyst Matt Maley believes “took a lot of confidence out of the asset class.” He noted:

“Investors don’t want to get burned again in the cryptos. Confidence is such an important part of new assets like cryptocurrencies. Until investors regain more confidence, they will no longer be a good risk-on/risk-off indicator.”

Analyst Fiona Cincotta believes that the ongoing decoupling is not one that crypto enthusiasts were expecting, adding: “I doubt this will be the end of the [inverse] Bitcoin-Nasdaq correlation.”

Interested in cryptocurrency? Learn more about the basics with our beginner’s guide to Bitcoin, dive deeper by learning about Ethereum and see what blockchain can do with our simple guide to DeFi.

Disclosure: The author owns a range of cryptocurrencies at the time of writing.

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

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