Bitcoin is down about 40% from its all-time high, compared with a 10% decline in the Nasdaq 100 Index.
On Friday, the crypto market was a sea of red, with bitcoin, the world's most valuable cryptocurrency by market value, falling more than 10% in the previous 24 hours.
As a result of global investors' lower appetite for risk at the start of the year, correlations between speculative assets like cryptocurrencies and stocks have strengthened, resulting in widespread losses. Bitcoin has lost about 40% of its value from its all-time high of almost $69,000, while the S&P 500 has lost around 7% of its value since its peak, compared to a 10% drop in the Nasdaq 100 Index.
Due to their higher risk profile than bitcoin, alternative cryptocurrencies (altcoins) led the way lower on Friday. Ether, the world's second-largest cryptocurrency by market cap, was down approximately 13 percent over the last 24 hours, compared with a 14 percent decline in AVAX and a 16 percent drop in FTM over the same period.
Despite the losses, some analysts believe the market will recover in the short future. "BTC is expected to find a bid around the $35K mark, or 50% off the peak. We may be able to test the $45K-$50K zone in the medium term, but the broader view remains gloomy as liquidity remains scarce "In an email to CoinDesk, Pankaj Balani, CEO of Delta Exchange, a crypto derivatives trading platform, stated.
For the time being, technical signs indicate that bitcoin has near-term support around around $37,000, however firmer support at $30,000 might prevent a larger decline.
In a Friday briefing, Katie Stockton, managing director of Fairlead Strategies, a technical analysis firm, stated, "Many altcoins are into support near their midsummer 2021 lows, making it crucial that bitcoin retains support as it sets the tone for the cryptocurrency sector." Stockton predicts a continued breakdown below current BTC price levels with a 30%-70 percent probability.
Latest prices
?Bitcoin (BTC): $38349, ?9.92%
?Ether (ETH): $2752, ?13.62%
?S&P 500 daily close: $4398, ?1.89%
?Gold: $1832 per troy ounce, ?0.57%
?Ten-year Treasury yield daily close: 1.75%
