Lisa Cook must be proud of herself today as she painted Friday red as the biggest driver of the recent sales. The Fed member, whom Trump tried to dismiss and who later retained his position with the court decision, talked about the bubble in technology stocks and the artificial intelligence collapse reignited its potential. The result was that cryptocurrencies suffered steeper losses.
Lisa Cook and Friday Drop
Yesterday’s unemployment number came in at a 4-year high and Nvidia’s earnings report increased risk appetite early yesterday. However, Lisa Cook, who took the microphone after the US market opening, implied that the markets were overinflated and the artificial intelligence bubble could burst, as if taking revenge on Trump.
On the same day, billionaire Ray Dalio said the bubble was at 80% and still had room to grow. Dow Jones fell nearly 500 points. S&P 500 fell to 6,617. Nasdaq fell to 22,432. The loss in the stock market from yesterday to today is over 2%, and the seemingly small losses experienced by trillion-dollar giants actually represent hundreds of billions of dollars.
While Amazon lost 4% and Microsoft lost 3%, BTC sales exceeded 10%. It is a known fact that declines in the stock market create a multiplier effect in crypto. Sam Stovall, CFRA’s chief investment strategist, says the selloff for the S&P 500 could extend as much as 9%. 5 trillion dollars Nvidia It lost 10% this month. This loss experienced by even a single company affects all giants due to close business relations.
Will the Crypto Decline Continue?
Bitcoin 
$82,845.16 It first lost the 112 thousand dollar threshold. He needed to take this back. Then 107 thousand started to be tested and we wrote that $ 102,800 was the level that should be protected for the 1.5-year uptrend. Afterwards, we wrote that when this is lost, 98 thousand dollars may be broken and the 88 thousand dollar support will weaken with closings below 92 thousand dollars. The stages were passed one by one and there was a big test near the bottom at $ 80 thousand.
While whales have been selling since October, short-term investors are also joining them. Therefore, the rise after each bottom test forces deeper bottoms under the pressure of intense sellers. Just one whale has sold 11 thousand BTC since October. He sold all the assets he acquired in 2011.
However, these sales must exhaust before reaching the bottom at $74,000. BTC It’s oversold on many metrics, and we’ve never had a period where short-term investors were this much at a loss. Neither FTX crash nor LUNA collapse What COVID This has never happened in any of them. It is not well understood because BTC is at higher levels than those days, but our $ 15,500 in the 2022 crash is a maximum of 56 thousand dollars. Our 20 thousand dollars in the previous collapse is a maximum of 69 thousand dollars. We need to understand the figures that change from cycle to cycle and interpret today accordingly.
But we have reason to be hopeful. If we were in a repeat of previous cycles, capital inflows would have to stop completely. This cycle is different from others, as experts say. Bitcoin is now starting to gain acceptance as a new asset class, and things will change further when the liquidity pool percentages of BTC in circulation change, just like gold. Ki Young Ju shared the above graphic and wrote;
“As digital gold Bitcoin ETFs has grown in size, but their capital structure suggests that the real qualitative leap has not yet occurred. Much larger liquidity pools await Bitcoin.”
