Bitcoin continues to hold above the $19,000 mark even as currency woes wreaked havoc across stocks and other legacy markets this week.
After dipping to lows beneath $18,600, Bitcoin bounced as high as $20,300 before paring the gains amid a highly volatile market that also saw the S&P 500 Index notch losses that puts it on course for three consecutive quarterly losses. It’d be the first time the index has registered this kind of performance since 2009.
If stocks face another sell-off and the tumbling continues in the face of a Fed tightening and concerns of a recession, Dylan Leclair, a senior crypto analyst, says the market could see a BTC outperformance against equities.
According to the analyst, Bitcoin’s “relative strength” against legacy indices has been encouraging, pointing to a BTC/S&P 500 chart.
Encouraging relative strength from the orange coin against legacy indices.
Still think a long lasting “decoupling” is highly unlikely in this stage, but relative outperformance is a decent start.
All eyes on FX, global bonds, and equities for the direction of the next move. pic.twitter.com/Enfbl0vn2R
— Dylan LeClair 🟠 (@DylanLeClair_) September 29, 2022
While he doesn’t expect the “decoupling” to be long lasting given broader market conditions, he still thinks the benchmark cryptocurrency could master a decent run against the index. What investors might have to watch out for, he tweeted, is what happens next within the legacy financial markets – equities, FX and global bonds.
The analyst however warns of a potential sell-off for Bitcoin should there be a “huge illiquidity event.” He said:
“Still convicted in my view of a legacy system vol event coming – it’s clear that liquidity tide is drawing out. BTC/USD exchange rate won’t be insulated from a huge illiquidity event, because nothing except USD & vol will.”
Bitcoin was trading around $19,260 on Friday morning (09:45 am ET), just in the green on the day but down 1.2% this past week. The S&P 500 opened higher lower and was at 3,634, more than 1.4% down in the past five days.
The post Bitcoin price: Analyst doesn’t expect long lasting decoupling ‘at this stage’ appeared first on CoinJournal.