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Mike Novogratz, crypto billionaire and early Bitcoin investor, speaks about the crypto market outlook after the latest sell-off. The cryptocurrency market succumbed to widespread selling pressure as Bitcoin and altcoins pared off the gains accumulated in the prior day. The Bitcoin price slid to lows of $37,704 while Ethereum dropped to $2,731 before a slight rebound. The majority of the crypto assets, especially in the top 100, are trading presently in red with most recording significant losses.
2) crypto will have a hard time rallying until stocks find a base. That said, crypto already had a decent sell off and is running into some buying support.
— Mike Novogratz (@novogratz) January 20, 2022
Finally, the best traders get good at gallows humor 😂
The Galaxy Digital CEO earlier predicted that Bitcoin might hit bottom lows at $38,000 as institutional investors prepare to buy amid a sell-off as 2022 progresses. The crypto billionaire had stated in an interview that he thinks big institutions are going to see the $38,000 level as an attractive place to buy.
However, as it stands, Novogratz believes crypto has already had a decent sell-off and is running into some buying support. He gives one condition on which this might happen—if stocks recover—saying, ''Crypto will have a hard time rallying until stocks find a base.''
Noting a breakdown in bonds and tens, the crypto billionaire predicted days before the downside pressure on the Nasdaq and crypto as long as rates go higher.
On-chain analytics firm IntotheBlock foresaw pressure on the Bitcoin price, stating "BTC hangs by a thread," while suggesting that the most important support level for Bitcoin lies between $38,900 and $40,200. Such a critical demand barrier must hold to prevent BTC from a steep correction toward $30,000, IntotheBlock says.
What's next?
According to IntotheBlock, BTC and ETH are showing an extremely high correlation to the Nasdaq 100 of 0.86, suggesting this might play a part in Bitcoin's recovery.
$BTC and $ETH are showing an extremely high correlation to the Nasdaq 100 of 0.86
— IntoTheBlock (@intotheblock) January 20, 2022
The historical correlation between crypto and traditional assets is important to track to understand how macro markets affect crypto, and how their relationships evolve. https://t.co/Wx8RxQwatF pic.twitter.com/Vfkns3daJ1
Crypto trader and economist Alex Kruger notes the cryptocurrency market's correlation with the equities market. The Nasdaq crashed earlier in tandem with cryptocurrencies as Netflix earnings plunged 20%.
Crypto analyst Michael van de Poppe says ''The U.S. open and the actions after are going to decide whether #Bitcoin will be nuking more or bouncing up.''
Bitcoin trades at $38,313 at press time.