Bitcoin Risks 20% Drop as Outlook for ‘Stimulus Junkie’ Stocks Sours

Bitcoin Risks 20% Drop as Outlook for ‘Stimulus Junkie’ Stocks Sours

Gate Trade News Sunday, June 28, 2020 64 0

The price of Bitcoin is at risk of a pullback as declining liquidity as the U.S. stock market is starting to slump.

 

The Dow Jones plummeted by 2.84% on June 26, recording a 9.27% fall since the month’s peak. As risk-on assets face the fear of a correction, the vulnerability of a near-term Bitcoin (BTC) price pullback may increase.

 

While many fundamental factors are causing a stock market downtrend, analysts are pointing at the decline in liquidity as the primary catalyst. As the Federal Reserve’s balance sheet started to contract, U.S. stocks fell in tandem.

 

The correlation between Bitcoin and U.S. equities in recent months raises the probability of a BTC price drop.