Bitcoin Mirrors Nasdaq-to-S&P 500 Ratio, Signaling Its Next Move

Bitcoin recently surged to an all-time high of $93,445 before pulling back to $90,000—a key level that aligns with a significant trendline from its 2021 peaks.

Bitcoin price recently dropped from its all-time high of $93,445 to $90,000. This level is a key resistance point that is aligned with a key trend line from the 2021 highs. The trend line is now acting as a key resistance point and is very important to pay attention to as Bitcoin price fluctuates around it. But the story doesn't end there.

It is interesting to see that Bitcoin price action reflects a pattern seen in the S&P 500 (NDX/SPX) ratio to Nasdaq, which tracks investor sentiment in technology and emerging sectors.

What does this mean to you.

Bitcoin's Connection to NDX/SPX Ratio

Since 2017, Bitcoin has shown a close relationship with both rates, often rising and falling together, and this connection was especially clear in April 2023, when Bitcoin trading at $30,000 followed bullish signals from a rising NDX/SPX rate . As the rate reached new highs in July, Bitcoin followed, hitting record highs.

Now that the NDX/SPX ratio has pulled below the trend line, Bitcoin has fallen to $90,000, mirroring this move. If this correlation holds, Bitcoin could remain below $90,000 for a while. However, if the NDX/SPX ratio turns up again, this could indicate a new Bitcoin rally, with some traders predicting a break above $100,000.

Bitcoin's Next Move

Traders are closely watching the Bitcoin options and futures markets, which suggests it could remain around $90,000 until a decisive change in the NDX/SPX ratio. If this rate recovers, Bitcoin could rise further, indicating investors' greater appetite for risk. This highlights Bitcoin's connection to traditional financial markets and investor sentiment.

Is Bitcoin Heading into a Bull Trap?

Despite the potential for a pullback, well-known investors like Robert Kiyosaki and WealthSquad's Chris remain positive about Bitcoin's future. For example, Kiyosaki plans to buy more when Bitcoin approaches $100,000. But some experts warn traders to watch for early signs of a turnaround. While current sentiment is positive, the future of Bitcoin is still uncertain. Depending on how the market operates, it may either continue its upward trend or pull back.

Technology rate climbed down within the expanding channel. Maybe BTC will do the same? We'll have to wait and see.

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