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Bitcoin, the top cryptocurrency, is struggling to get back on its feet, extending its losses. It has now dropped to yet another intraday low of $37,683 on the Bitstamp exchange, the lowest level since early August.
The cryptocurrency has shed over 13% within 24 hours after recovering to the $43,500 level on Jan. 20. A whopping $909 million worth of crypto has been liquidated over the last day.
With futures in the red, the U.S. stock market is on track to have another rough day, reeling from the increasingly hawkish Federal Reserve.
Hedgeye Risk Management CEO Keith McCullough explains that Bitcoin topped out in November and then broke the trend before entering Quad 4 in late December.
That's dead wrong. Bitcoin peaked during #Quad2 in Q4 and then broke TREND front-running #Quad4 in Q1 https://t.co/fIV6GUrob8
— Keith McCullough (@KeithMcCullough) January 21, 2022
Last week, he tweeted that he was out of Bitcoin and other momentum-driven risk-on assets.
Hedgeye uses its propriety Growth, Inflation, Policy (GIP) model to gauge market sentiment and forecast asset returns. It is divided into four economic regimes (quads), with Quad 4 usually representing the most unfavorable environment (slowing inflation and slowing words).
McCullough's words should be taken with a grain of salt since the model is not perfectly reliable. The analyst became a source of ridicule within the cryptocurrency community after famously selling his entire Bitcoin stash in early October at $10,000, claiming that the Bitcoin community was driven by narratives and emotion instead of math. This happened right before the top cryptocurrency went on to quadruple in value in just a few months. A separate Twitter account was created in order to track McCullough's poorly timed trade.
The price of #Bitcoin is up $36,624 (345.51%) since Keith McCullough sold
— Keith McCullough sold his Bitcoin (@KeithSold) February 9, 2021