Bitcoin is in the equation even before the latest drop.
The S&P 500 and Dow both reached new highs at the start of the year, but it couldn't take out its November peak.
Despite a shaky dose of bearish divergence, these news highs went to the surface. I was hoping for a phantom bear market.
As a result of a largely large number of stocks and a clear bear market in growth stocks, this is a good thing.
All you had to do was have Ark Innovation Fund () - to know it.
On January 6, I said bitcoin and ethereum, but the majority of FAANG was starting to slip. So where Tesla () - and Nvidia () -. Another risk-on asset crypto was also struggling.
Whats next for the leader in crypto?
Bitcoin is trading around the world.
Bitcoin is a weekly chart of transactions.
TrendSpider.com is the new model of trends.com.
Bitcoin has dropped about 5.5% so far today, while Ethereum is down about 7%. Both are hitting lows not seen since the third quarter of 2021.
This $40,000 level has been significant for Bitcoin and we have written several times over the last month. It is not only the December low/the flash crash low, but its been a steady boost for months.
Last week we saw bitcoin trade back below the weekly VWAP measure. It was later rejected by this measure (just as it was this week too).
The lowest level of caution was the reduction of $40,000.
For the time being, Bitcoin is getting a deal, but unless it can restore the $40,000 to $41,000 zone, I am a little hesitant with this one.
Along with the weekly VWAP measure, the two-week high is back above $41,000.
If bitcoin continues to trade lower, traders should keep an eye on the 21-month moving average at $34.250.
Is this a $30 stock, but it might be like saying plus or minus $1 or $2 a share?
For a commodity with so much volatility, its not so depressing.
In that $30,000 zone, this is also the monthly VWAP measure. It's also where Bitcoin found support all throughout 2021. If the equity markets remain under pressure, I'd be reluctant to rule out a test of this area for bitcoin.