Bitcoin (BTC) sank to intraday support on Aug. 16 as concerns emerged over the fate of United States stock markets.
U.S. stocks face stiff resistance
After an eerily calm 24 hours, downside set in at the day's Wall Street open as previous highs in excess of $25,000 looked increasingly like a double top.
Analyzing the potential outcomes, a typically conservative Il Capo of Crypto warned that upside was now highly unlikely given Bitcoin's inability to break out.
"Two options, both bearish," he began a fresh Twitter update on the day by saying.
"1) Up to 25400–25500 and then reversal of this medium tf bullish trend, straight to new lows. 2) Straight to new lows from here. Bearish confirmations: below 23500 and below 22500. Bullish continuation: consolidation above 26k."
The argument that BTC/USD would ultimately fail to crack resistance was strengthened by the view that U.S. equities were coming up against long-term ceilings of their own.
In his own analysis, Jurrien Timmer, director of global macro at asset manager Fidelity Investments, additionally flagged a large proportion of S&P 500 stocks trading above their 50-day moving averages.
"The percentage of stocks in the S&P 500 trading above their 50-day moving average—88%—is stunning," he commented.
"Does this signal enough positive momentum to indicate that a new cyclical bull market is underway, or is this merely a bear market rally that is now at an overbought extreme?"
A subsequent post added that many stocks had a relative strength index (RSI) of 70 or more, something Timmer said spoke to the "momentum" behind the current rally.
Timothy Peterson, investment manager at Cane Island Alternative Advisors, meanwhile had an equally unappealing long-term prognosis for the S&P 500.
The index was down 0.3% on the day at the time of writing, while the Nasdaq Composite Index traded down 1%.
DOG steals the show on altcoins
On altcoins, it was Dogecoin (DOGE) leading the gains amid an otherwise flat top 10 cryptocurrencies by market cap.
DOGE/USD passed $0.09 for the first time since May 18 on the day, marking gains of 86.5% versus the pair's recent macro bottom in mid-June.
By contrast, Ether (ETH) was unmoved over the past 24 hours, nonetheless trading under $1,900.
James Stanley, senior strategist at trading firm DailyFX, was nonetheless bullish on ETH/USD versus its own June lows, placing support at $1,818.
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