Bitcoin reaffirms its current correlation with equities as tech stocks in particular suffer as trading gets underway.
Bitcoin (BTC) fell on the Wall Street open on Feb. 2 as another tech stock rout panicked traders.Â
Bitcoin: “Macro FUD is driving all”Â
Data from Cointelegraph Markets Pro and TradingView tracked BTC/USD as it dipped below $38,000 as Wall Street began, giving back half of the gains secured on Monday.
At the time of writing, the pair traded near $37,600 as tech stocks took a beating. These were led by PayPal, shares in which shed nearly 25% after the company reported missed earnings targets.
Data from Bloomberg showed the extent to which early pandemic gains have been wiped out this year and last, in the case of PayPal 52% and others, such as Zoom and Peloton, by 70% or more.
With its latest dip taking bulls even further away from crucial resistance, analysts were thus uninspired by Bitcoin in the short term.
“Market structure for me is still clearly bearish under $39.6k. Would like to see daily closes over $40.2k before I felt a bigger rally possible,” popular Twitter account TXMC Trades summarized on the day.
“My base case is still a test of $29-30k (or lower) before any future price discovery. Macro FUD is driving all. HODL and wait.”
As Cointelegraph reported, not everyone expects immediate downside, with the possibility of a retest of $40,000 still possible for some.
On-chain data also remained encouraging despite the depressed price performance lingering. Further to previous comments, statistician Willy Woo on Wednesday reiterated that all is healthy for Bitcoin under the hood.
“Price in relation to on-chain demand from both speculative and hodl category of investors are now both at peak oversold levels,” he told Twitter followers.
“The last time this happened was October 2020. The time before that was at the bottom of the COVID crash.”
A look at derivatives markets saw funding rates hold slightly negative at the time of writing, as fellow analyst William Clemente took the opportunity to remind traders that negative rates may not necessarily be shorters “piling into” the market hoping for further deterioration.
Altcoins broadly weather the market storm
Altcoins meanwhile remained broadly steady, with Ether (ETH) the outlier out of major tokens with a 2.1% drop on the day.
Related: All the world’s Bitcoin can only pay 2.43% of $30T US national debt
ETH/USD traded at $2,680 after the Wall Street open, nonetheless still up 1.7% versus the same time a week ago.
Others in the top ten cryptocurrencies by market cap were either flat or down by a modest amount compared to Bitcoin’s 1.6% dip.
As Cointelegraph reported, Bitcoin has upped its market cap dominance versus altcoins in recent weeks to reach a two-month high.
