Bitcoin, Ethereum, and the entire crypto universe faced cataclysmic declines earlier this year as a tightening of monetary policy stopped the rally in digital assets in its tracks, and spurred a sharp selloff.
Although the mainstream media were largely hysterical at the scale of the declines, long-term crypto investors, as well as the analysts at Frederick & Oliver, were unperturbed by the move.
Having traded as high as $64,400 in the second half of 2021, Bitcoin slid and eventually capitulated to trade below $18,000 as the broader crypto complex crashed.
In the previous so-called ‘Bitcoin winter’ in 2018, Bitcoin then also fell by over 80% before breaking to new highs. Such volatility has conditioned crypto traders to expect volatility and looks for such opportunities for entries.
“Bitcoin and Ethereum had fallen more than 70%, discounts of this magnitude must be explored regardless of asset class. Major coins had previously registered sizeable rallies following steep declines, we felt this opportunity was too good to pass up,” said Marc Kimsey, trader at Frederick & Oliver.
Bitcoin has displayed a high correlation with US Tech stocks. The same factors driving the downside in Bitcoin also impacted tech stocks – and just same they moved down in tandem, the two have bounced from lows hand in hand.
With the US recording a technical recession yesterday, investors have taken the opportunity to buy into tech shares, and Bitcoin, on hopes the worst is now behind us.