Bitcoin and Ethereum have not shown a strong correlation to the Nasdaq 100 which is one of the world’s preeminent large-cap growth indexes, or gold this month. Bitcoin continues to consolidate around $27K but remains in a longer-term uptrend.
On the other hand, Ethereum is showing signs of a bullish breakout today, which could open a door for a move up to $2,000 next.
Since crypto assets like Bitcoin and Ethereum have been widely investable, investors have debated where the asset class should be placed in a portfolio.
Investors and crypto experts have posed the following questions: Are they more similar to “store of value” commodities like gold? Or are they more like volatile risk assets like the Nasdaq 100?
Cynics would even argue that they are simply a bubble that will inevitably disappear. However, that argument becomes less and less convincing as Bitcoin approaches the 15th anniversary of its “Genesis Blockchain” on January 3, 2009.
Even for nearly a decade and a half, the answer remains elusive. Take the price action over the course of this month as an example: gold has struggled amid U.S. dollar strength, while the Nasdaq 100 has rallied after a strong earnings season, while Bitcoin and Ethereum remain essentially unchanged:
To put some numbers on this, Bitcoin’s 30-day correlation with the Nasdaq 100 has fallen to -.61, its lowest level since late 2022 (and June 2021 before that), and the equivalent correlation coefficient with gold stands at,30, near two -month lows.
Looking ahead, latent financial issues such as the US debt ceiling discussion and global banking sector tensions could boost crypto assets if they spill over in the coming days and weeks. Still, for now, interest and volatility in the cryptosphere remain subdued.
In the following section, there are technical analyses of Bitcoin and Etherum related to trading situations and how traders approach each of them.
h2 Bitcoin/h2 Technical Analysis
Looking at the Bitcoin charts, traders are waiting for a definitive breakout with the $27K level that has magnetically pulled prices back steadily over the past two weeks. The cryptocurrency is still holding above its rising 100-day and 200-day EMAs, suggesting that the long-term trend is still in favor of the bulls for now, so as long as support at the lower $26K range holds, swing traders can maintain a bullish bias.A break below that support zone would confirm a modified head and shoulders pattern and point to a deeper pullback towards the 200-day EMA near $25K at the very least.
h2 Ethereum/h2 Technical Analysis
Ethereum’s chart looks similar to its big brother, although today’s price action suggests a possible breakout of the recent consolidation range. For ETH/USD, a daily close near the current, a daily close near current levels would open the door for a continuation toward monthly highs near $2000, followed by 1-year highs around $2100 below. A reversal below the 100-day EMA near 1775 would erase the short-term bullish bias.
By Marina Meza