Bitcoin’s Value Slumps in Tandem with S&P 500. Caution Needed as Significant Losses May Loom.

Bitcoin’s Value Slumps in Tandem with S&P 500. Caution Needed as Significant Losses May Loom.


and other cryptocurrencies fell Tuesday as weakness spread across digital assets in step with losses in the stock market. Crypto bulls are holding firm but Bitcoin is nearing important price levels that could see declines accelerate.

The price of Bitcoin has dropped 5% over the past 24 hours to $66,200, extending declines after the largest digital asset tumbled through the psychologically important $70,000 level on Monday. Bitcoin hit an all-time high near $74,000 in mid-March but has struggled to consolidate around that peak, suffering a volatile correction after notching its record level before making another run up above $70,000 in recent days, before more declines.

“A promising consolidation has yet to bear fruit. For Bitcoin, the bullish chart picture has not changed: We see only an extension of the consolidation after the rally from the January lows to mid-March,” said Alex Kuptsikevich, an analyst at broker FxPro. “The next key support area is $62,800 to $63,000, where the 50-day moving average and the lows of the corrective pullback in March are centered.”

While Bitcoin faces some near-term technical risks, the outlook remains bright.

Cryptos continue to benefit from demand from spot Bitcoin exchange-traded funds (ETFs), which were approved by U.S. regulators in January and have ushered in a fresh wave of investor interest and billions of dollars in inflows. Bitcoin’s so-called halving also looms this month, with the issuance of new tokens set to be cut in half, restricting supply when demand has been rising and likely to give further support to prices.

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More immediately, wider risk sentiment could be a headwind. Bitcoin has shown itself to be linked to other risk-sensitive assets—namely, stocks—and the token’s latest declines came as the

Dow Jones Industrial Average


S&P 500

fell back from record highs on Monday.

Investors in the stock market are reacting to economic data that could impact the outlook for interest-rate cuts for the Federal Reserve, with multiple catalysts in the days ahead that could swing sentiment and ripple across to cryptos.

Beyond Bitcoin,


—the second-largest crypto by market value—fell 6% to below $3,350. Smaller tokens were similarly weak, with


down 7% and


plunging 6%. Memecoins were deep in the red, with


dropping 11% and

Shiba Inu

shedding 8%.

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Write to Jack Denton at

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