Bitcoin (BTC) fell at the Dec. 22 Wall Street open as United States equities reversed previous gains.
Bitcoin risks new and unseen “death cross”
The pair remained a conspicuous stocks copycat as the S&P 500 opened down 1.6% and the Nasdaq Composite Index traded down 1.8% at the time of writing.
The weakness appeared to be a reaction to stronger-than-expected United States gross domestic product (GDP) growth in Q3, data that was released prior to the open.
Despite notionally a sign of recovery, concerns focused on the Federal Reserve continuing its restrictive economic policy on the assumption that the economy would be able to withstand the measures.
This would notionally come in the form of longer-lasting interest rate hikes, with analysts already arguing that a “pivot” in policy was unlikely until 2024 at the earliest.
As such, risk assets saw no relief from the GDP print, further disappointing traders hoping for a Santa Clause rally.
“Clear bearish retest. Downtrend intact,” trader and analyst Il Capo of Crypto commented on the daily S&P 500 chart.
Il Capo of Crypto warned earlier this week that markets as a whole were “not prepared” for what would be fresh upcoming losses.
On Bitcoin, the mood among some pundits was likewise firmly bearish.
Bleeding Crypto highlighted a never-before-seen “death cross” involving the 50-day and 200-day exponential moving averages (EMA) now due.
Daan Crypto Trades meanwhile drew attention to the yearly close, this likely to become Bitcoin’s third negative year ever.
“The percentage loss this year is sitting right in between the other two negative years, being 2014 and 2018,” he noted.
Elsewhere, analyst Toni Ghinea had little optimism in store for Bitcoin bulls, arguing that the macro bottom would not appear until Q1 2023.
“Capitulation to 11-14k. Bottom in Q1 2023. Expecting the final move down soon,” a tweet read.
The dollar seeks comeback after GDP print
The main beneficiary of the GDP print, meanwhile, was the U.S. dollar, which saw a confident rebound in strength.
The U.S. Dollar Index (DXY) circled 104.5 at the time of writing, up from lows of 103.75 before the open.
The greenback thus went some way to recovering losses engendered by a surprise intervention by the Bank of Japan earlier in the week.
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