According to recent data shared by the on-chain analytics platform IntoTheBlock, the two largest cryptocurrencies, Bitcoin (BTC) and Ethereum (ETH), continue to maintain an extreme correlation with the stock markets. The 30-day correlation of both assets to stock is now as high as 0.9.
The on-chain analytics firm shared this via a tweet a few hours ago. According to the report, the correlation matrix has been displaying how cryptocurrency is moving side by side with traditional equities.
Read Also: Dubai School Announces Plan to Accept Tuition Payment in Bitcoin (BTC) and Ethereum (ETH)
IntoTheBlock tweeted, “BTC and ETH correlation with traditional markets continue to be extremely high. Our correlation matrix displays how crypto is moving almost in tandem with traditional equities such as Nasdaq, S&P500 and Dow Jones 30-day correlation is above 0.9.”
$BTC and $ETH correlation with traditional markets continue to be extremely high
Our correlation matrix displays how crypto is moving almost in tandem with traditional equities such as Nasdaq, S&P500 and Dow Jones
30-day correlation is above 0.9
Chart: https://t.co/Wx8RxQwatF pic.twitter.com/hsUbUMU9HH
— IntoTheBlock (@intotheblock) May 19, 2022
There were indications that stocks might be on the verge of a bear market after the Federal Reserve raised interest rates by 50 basis points at its Federal Open Market Committee (FOMC) meeting in May.
A number of Bitcoin bulls had to conclude that the cause of the recent crypto market declines can be attributed to the downturn in the traditional markets. On Thursday, stock futures were under pressure once again, with the S&P500 on the verge of a bear market.
On the other hand, Bitcoin has remained around $29,000 for the second day in a row, causing the rest of the crypto market to suffer slight losses. Ethereum has lost 3.67% in the last 24 hours, although it is still trading near $2,000. The top 10 digital currencies, except stablecoins, are all losing ground, with losses ranging from 0.36% (BNB) to 5.77% (SOL).
Any Further Weakness Can Send Ethereum (ETH) Below $1,000
Ali Martinez, a closely followed crypto analyst, is also of the opinion that further weakness in Ethereum (ETH) might lead to a drop to below the $1,000 price level,
Ali Martinez tweeted, “Transaction history shows that 2.24 million addresses bought 26.33 million ETH at $2,300. Any signs of weakness might encourage these addresses to sell, which could see Ethereum drop to its most important support at $700 where 13.25 million addresses hold 13.1 million ETH.”
Transaction history shows that 2.24 million addresses bought 26.33 million $ETH at $2,300.
Any signs of weakness might encourage these addresses to sell, which could see #Ethereum drop to its most important support at $700 where 13.25 million addresses hold 13.1 million #ETH. pic.twitter.com/5SE67MhHwh
— Ali Martinez (@ali_charts) May 18, 2022
Read Also: European Union (EU) Parliament Votes against Ban on Bitcoin and Ethereum’s Proof-of-Work (PoW)
Although it’s possible for the market to decline further, Bitcoin (BTC) and Ethereum (ETH) continue to gain traction.
A few days ago, the President of El Salvador, Nayib Bukele, announced a meeting of 32 central banks and 12 financial authorities from 44 countries held on May 16 to discuss financial inclusion and El Salvador’s Bitcoin adoption.
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