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In a recent article, Bloomberg has reported that the today’s Bitcoin recovery to the $38,000 level in Hong Kong was correlated with the growth of U.S. futures. The latter took place in the run up to the upcoming Federal Reserve meeting.
So far, the flagship cryptocurrency has returned to the highest level since January of last year. At the moment, Bitcoin is more than 50% below its all-time high smashed in November, when Bitcoin almost reached the $69,000 price mark.
Now, analysts believe $30,000 to be the next level of support for Bitcoin.
Correlation of crypto and equities strengthens
Experts have been pointing to a high correlation between Bitcoin and equities for a while already. As reported by U.Today, the most recent analyst to do so was Bloomberg’s chief commodity strategist Mike McGlone, who posted a chart to illustrate this, where Bitcoin was moving neck-and-neck with the S&P 500 index.
Prior to that, CNBC’s Brian Kelly talked about a close correlation between Bitcoin and the Nasdaq 100, saying they may bottom together at the start of 2022.
Responding to the potential tightening of monetary policy by the Fed, investors have begun to get rid of expensive tech stocks and cryptocurrencies too.
More “dipbuyers” to emerge: expert
On Wednesday, the Fed is to end its two-day meeting, and shortly after that, the chair, Powell, will come up with a policy decision regarding rates. Anna Wong, an economist from Bloomberg, believes that the Fed will hold the rates steady and raise the speed of tapering, promising a rate rise in March of this year.
Todd Morakis, a JST Capital cofounder, expects investors to buy more coins on the dip as prices are declining.