Bitcoin (BTC) recovered above $37,000 on Feb. 3 after a stocks rout took the wind out of bulls’ latest attempt to crack $40,000 resistance.
“Extraordinary moves” for stocks
The weakness followed shock losses for U.S. equities at the Wall Street open on Wednesday, with major names such as PayPal shedding huge portions of their value after underwhelming performance reports.
Major stocks have been experiencing extraordinary moves post earnings after hours this season
Liquidity and the Fed’s put are both gone
— Alex Krüger (@krugermacro) February 3, 2022
Meta then followed in the after hours, hemorrhaging 20% of its share price in the wake of data showing it had begun losing users for the first time.
Facebook “Meta” going to zero as investors learn the metaverse literally doesn’t exist
— Cobie (@cobie) February 2, 2022
While Bitcoin proponents were quick to poke fun at the events, frustrating price action meant that the area identified as a key resistance/support flip looked all the less likely to break.
“If Bitcoin loses this level at $37Kish, I think it will start to drop fast towards the lower bound of the region around $34-35K,” Cointelegraph contributor Michaël van de Poppe said overnight.
Van de Poppe added that going forward, the strength of the U.S. dollar could be key to understanding the coming moves for crypto markets as a whole. The U.S. dollar currency index (DXY), with which crypto is traditionally inversely correlated, lost big in recent days.
“It’s really dependent on the DXY on what we’re going to see on the crypto markets,” he told Twitter followers.
“If the DXY is reversing in the coming weeks towards a downwards trend, that should be a huge accelerator for upwards momentum for Bitcoin.”
Altcoins catch up to Bitcoin’s losses
Altcoins meanwhile extended their losses on the day, with the top ten cryptocurrencies led by Solana (SOL), down nearly 10%.
A host of issues for the platform had contributed to downward price pressure, with SOL/USD trading under $100 at the time of writing.