Bitcoin and S&P 500 massive crash reveals key insights, according to analyst
The post Bitcoin and S&P 500 massive crash reveals key insights, according to analyst appeared on BitcoinEthereumNews.com.
On August 4, 2024, both Bitcoin (BTC) and the S&P 500 experienced a significant drop, with Bitcoin falling by 7.5% and the S&P 500 by 3%. This comes amidst mounting recession fears and notable market volatility. On August 2, $2.9 trillion vanished from the stock markets, marking the worst day of trading since the COVID-19 crash in 2020. The crypto markets were also heavily impacted, with Bitcoin dropping by 18%, Ethereum (ETH) by 27%, and more than $381.26 million in futures positions liquidated in 24 hours. The Fear & Greed Index has now shifted dramatically from greed last week (67) to extreme fear (17) as of August 6, 2024. In a recent post on August 6, analyst apsk32 indicated that this marks one of the few times in history where both markets have experienced such substantial drops simultaneously. Historically, these simultaneous declines have often been followed by significant market movements. Contributing factors and market impact Several factors have contributed to this market downturn. The US nonfarm payrolls report on August 2 showed a steep slowdown in hiring, signaling potential economic trouble. Additionally, the Bank of Japan’s (BOJ) decision to raise its interest rates for only the second time since 2007 had a global ripple effect. The slight interest rate increase from 0% to 0.25% sparked significant market reactions, particularly impacting the yen carry trade. This strategy involves borrowing yen at low interest rates to invest in higher-yielding assets. This shift in BOJ policy has added to the market’s instability, leading to widespread sell-offs and heightened volatility. Historical context and potential opportunities According to analyst apsk32, occurrences around Bitcoin halving events provide useful context for understanding potential market movements. Bitcoin and S&P 500 comparison over the past eight years. Source: apsk32/X On March 12, 2020, and September 3, 2020, these dates…
Filed under: News - @ August 6, 2024 2:10 pm