The Bitcoin price It briefly dipped below $67,000 on October 21, though it quickly rebounded to that level as support before the daily close. This price decline is believed to be due to its correlation with the stock market, which has also experienced its own decline.

Why the price of Bitcoin dropped below $67,000

Bitcoin’s price fell below $67,000, mainly due to correlation with the US stock market. IntoTheBlock data shows that the correlation between the flagship cryptocurrency and the S&P 500 is currently 0.63, indicating a robust positive price correlation. The S&P 500 and Dow fell from record highs on October 21 before the results were released.

Stock market decline i Bitcoin price collapse It is believed that their cause is the uncertainty in the macro environment. This market uncertainty is due to rising inflation expectations and concerns about how government spending is contributing to this development. As a result, market participants are currently cautious about the next move, with some waiting to see what steps will be taken US Federal Reserve will take action to keep inflation within the 2% target.

The upcoming US elections also contributed to market uncertainty, especially as the presidential race between Donald Trump and Kamala Harris appears to be close. It’s not unusual for investors to wait on the sidelines until after the election to gain confidence in the market’s prospects under the novel president.

Other factors contributing to the price collapse

Analyst Justin Bennett He cited “open interest (OI) reaching highs in July, whales trimming long positions and the rally driven by perpetrators last week” as other factors contributing to the Bitcoin price crash. He argued that these factors, combined with the upcoming U.S. election, caused prices to crash.

US election impact analyst excellent that markets usually mock before the US presidential election, which is just thirteen days away. He noted that it would have been a “disaster” if markets hadn’t laughed it off earlier and continued to push on election night.

Bennett made this statement while also noting why he expected Bitcoin and other crypto assets to be delisted. Indeed, an analyst has been stating since last week that the flagship cryptocurrency will soon experience a price correction. He has previously mentioned that he would not be surprised if the BTC price corrects approximately $63,000.

In the newer one Post Xhighlighted the $65,800 range as the first test of Bitcoin’s price. Holding above this level may invalidate his trade setup.

At the time of writing, Bitcoin is trading at around $67,700, down almost 2% in the last 24 hours, according to data from CoinMarketCap.

Featured image created with Dall.E, chart from Tradingview.com