A popular crypto analyst warns of a 'grave danger' for Bitcoin BTC/USD as the apex cryptocurrency rallies on news that Brazilian lawmakers have approved a regulatory framework for using BTC for payments.
What Happened: Lark Davis told his 480k followers on YouTube that “it's nice to see the markets showing a bit of green” after the turmoil fueled by FTX collapse but “we've got some real risks remaining in the equity markets, which can still drag everything down for crypto.”
BTC traded above $17k levels on Tuesday, showing signs of relief, however, Davis said that “we are still 75% down from all-time highs.”
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The analyst notes that a very important area that a lot of people are eyeing is the $17,800 mark, “because by the time likely Bitcoin gets around here, we're going to see it coming into an area of coincidence with a 50-day exponential moving average.”
This shows signs of an incoming rally. Davis adds that “this is a short-term thing, but could provide a bit of price relief in the markets”
According to Davis, the real threat comes from the stock market. On Tuesday, the S&P 500 dropped as Apple and Amazon shares fell ahead of a speech by Federal Reserve Chair Jerome Powell, who may provide hints about future interest rate hikes.
“It is horrible news for crypto. If the interest rates rise, it would lead to a massive bleed out in stocks, followed by crypto.”
Price Action: At the time of writing, apex crypto Bitcoin BTC/USD was trading at $16,902, up 2.78% in the last 24 hours, according to Benzinga Pro.
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