dailyhodl.com
A widely followed crypto analyst is predicting that Bitcoin (BTC) is headed for a major correction based on a flashing bear signal.
In a new video update, Nicholas Merten, the host of DataDash, tells his 511,000 YouTube subscribers that Bitcoin’s performance against the NASDAQ is weakening, indicating a downward trend for the crypto king.
Merten notes that in the near-term big tech is putting up huge gains, fueled by the potential of artificial intelligence (AI) technology, and outpacing Bitcoin’s price action.
“What’s been really concerning as of recent is watching the NASDAQ, the broader measurement of technology stocks… massively outpacing Bitcoin at the moment. They are continuing to churn higher here off of promises in relation to artificial intelligence. That is the big trend now…
The NASDAQ is at its highest point since back in April 2022…
We believe that we’re still in a bear market long-term. I have to be honest, though, this price action is starting to challenge that. We are starting to see momentum here accelerate quite big-ly over the past couple of weeks, as we’ve seen the NASDAQ pop from around 12,300 towards 13,240. Again, pressing it toward its highest point since April of 2022.
Now, can Bitcoin say the same here? Well, not exactly…
We are back towards ranges that we have not seen since back in June of 2022. And essentially we are steadfastly approaching where we were back here in August.”
Merten says by comparing Bitcoin against the NASDAQ using the BTC/NDX ratio, the crypto king appears setting the stage for a major move to the downside as BTC is giving up the gains printed against NASDAQ during Bitcoin’s recent rally.
“Main point here is this: We need not look further than the Bitcoin to NASDAQ ratio…
From November of 2022 here towards April of 2023, during this six-month window, Bitcoin was heavily outpacing the NASDAQ. It went from around a ratio of 1.4 up to 2.5…
Generally speaking, Bitcoin outpaced the NASDAQ by 75% from those absolute lows. That was a really great recovery and one of the strongest what we think is relief rallies for Bitcoin that we’ve ever seen, only comparable probably, at least in the sense of the scale of market cap, to the rally we saw back during the bear market lows of 2018 into 2019.
But we need to ask whether or not that’s following through. Because right now, the ratio itself has declined by more than 20%. And it is approaching a critical level here.”
Bitcoin is trading for $26,904 at time of writing, up 5.4% during the last 24 hours.
Generated Image: Midjourney