Bitcoin could lose $ 30,000 if stocks crash

Bitcoin could lose the $ 30,000 price if stocks start to fall as the downside risk to BTC increases due to the recent dollar rally as we read more on bitcoin news today.

As early as 2020, the prospect of a rapidly spreading coronavirus pandemic led to a massive lockdown in industrialized and emerging countries, as a result of which global stocks plummeted and BTC lost half its value for two days. Meanwhile, the US dollar index, or DXY, which represents the strength of the greenback against a basket of other currencies, rose 8.7% to 102.992, its highest level since 2017.

The inverse correlation shows that investors are ditching stocks and their BTC holdings, looking for security when they think this is a better bet than the dollar. More than a year later, Bitcoin and the stock market are grappling with a similar bearish sentiment, led by renewed demand for the U.S. dollar following the Federal Reserve’s announcements. The US Federal Reserve announced that it would raise its key rate by the end of 2023, a year ahead of its original plan.

Falling interest rates helped drag BC and the US stock market out of its slumber, and the cryptocurrency surged from $ 3,858 to nearly $ 60,000 in 2021 when the Fed raised lending rates to 0%, or 0.25%. Meanwhile, the S&P 500 is up more than 95% from its March 2020 high, and the Dow Jones and Nasdaq have rallied too. This happened after the Fed rate hike was announced, but the US dollar index also rose to a two-month high, showing renewed appetite for the dollar in the market. Analyst Willy Woo says the stock market crash coupled with a bullish dollar could reinforce bearish proposals for Bitcoin:

“Some downside risk when the stinks fill up, lots of rallies in DXY (strong USD), which is typical for money movements in safety.”

Scion Asset Management head Michael Burry raised the alarm over the collapse of Bitcoin and the stock market, adding that Bitcoin could lose up to $ 30,000 if stocks fall from the trillion:

“The problem with crypto, like most things, is leverage. If you don’t know how much leverage is in crypto, you don’t know anything about crypto. “

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