Analysts in both traditional and crypto markets have noted some striking similarities between the recent market crash and the one caused by the pandemic panic in March 2020..
The real question is whether this is the start of a bigger drop or whether there will be a significant rebound like in 2020which led to a prolonged bull run in both the crypto and stock markets.
Podcaster and author of The Pomp Letter, Anthony “Pomp” Pompliano tweeted on Wednesday that since March 1, 2020, when a bitcoin cost around $8,545, “bitcoin is up 340%”.
Bitcoin is up 340% since March 1, 2020.
As central banks around the world devalued their currencies at a historic rate, there is only one asset that stood out from the pack.#bitcoin is the savings technology that shields billions of people from undisciplined monetary policy.
— Pomp (@APompliano) May 17, 2022
Bitcoin is up 340% since March 1, 2020. While central banks around the world devalued their currencies at a historic rate, there is only one asset that stands out above the rest. Bitcoin is the savings technology that protects billions of people from undisciplined monetary policy.
Among those hoping for a change of course is the CEO of investment firm Real Vision, Raoul Pal, who believes that bitcoin (BTC) markets have been painting a pattern that shares traits with the March 2020 crash.
On his Friday episode of Raoul Pal Adventures in Crypto, Pal explained that, with last week’s downward price action, bitcoin may have “shot straight down” to the bottom of a current wedge formation and is now in a range that will eventually lead to another price rally. prices. He said:
“That was exactly the kind of pattern we had in March 2020.”
On March 12, 2020, investors panicked and sold many assets, including bitcoin, fearing how the market would be affected by the COVID-19 pandemic and global lockdowns.. That day, bitcoin fell 45%, from $7,935 to $5,142, according to CoinGecko.
The ongoing decline in traditional markets has led to a $7.6 trillion loss in the tech-heavy Nasdaq’s market capitalization in non-inflation-adjusted terms, more than the dot-com bubble and March 2020 sales.
The numbers are obviously not adjusted for inflation but still mind-blowing to see in this context. pic.twitter.com/aHem93mhpo
— Mati Greenspan (@MatiGreenspan) May 17, 2022
The numbers are obviously not adjusted for inflation, but it’s still mind-boggling to see them in this context. pic.twitter.com/aHem93mhpo
The cryptocurrency fear and greed index crashed to 8 on Tuesday, which is the lowest level it has seen since March 2020..
#crypto fear & greed index is at 8 out of 100.
The lowest number since the COVID-19 crash in March 2020. pic.twitter.com/jKVTcjrXV1
— Michael van de Poppe (@CryptoMichNL) May 17, 2022
The cryptocurrency fear and greed index is at 8 out of 100. It is the lowest number it has recorded since the COVID-19 crash in March 2020. pic.twitter.com/jKVTcjrXV1
The 50-day moving average (MA) of financials, real estate and technology investments is close to overwhelmingly oversold levels seen just over two years ago.. In March 2020, respectively, those levels were 0, 0 and 1 compared to 2, 3 and 4 so far in May, according to data from Fidelity Investments. In a Wednesday tweet, Fidelity’s own Global Macro Director, Jurrien Timmer, qualified as of March 2020 as “one of the most oversold configurations in market history”.
The Future Fund’s managing partner, Gary Black, noted Tuesday that Tesla shares are trading at a 20% discount, the widest to analysts’ price target since March 2020. He added that “in the following 12 months, TSLA is up 660%”.
The last time $TSLA traded at this wide a discount (25%) vs the avg Street PT ($984) was in March 2020, at the height of the Covid crisis. Over the next 12 months, $TSLA pink 660%. Source: https://t.co/5fcVwWX78i pic.twitter.com/z2AHe5zkVi
— Gary Black (@garyblack00) May 16, 2022
The last time TSLA traded at such a deep discount (25%) against the average Street PT ($984) was in March 2020, in the midst of the Covid crisis. In the following 12 months, TSLA rose 660%. Source: https://t.co/5fcVwWX78i pic.twitter.com/z2AHe5zkVi
The S&P 500 index also shows similarities: It hit a 52-week low of 3,930 on May 12, only to bounce back to 4,088 by market close on Tuesday.. The chief market strategist at financial research firm LPL Research noted in a tweet on Wednesday that the last time the index had done that was in March 2020.
The S&P 500 just made a 2% gain in two of the past three days coming off of a 52-week low.
The last times that happened?
March 2009 and March 2020.
— Ryan Detrick, CMT (@RyanDetrick) May 17, 2022
The S&P 500 just gained 2% in two of the last three days, coming off a 52-week low. The last times this happened? In March 2009 and March 2020.
Before traders get too excited, it is necessary to clarify that market conditions are very different now, because inflation and interest rates have increased. So governments reacted with unprecedented support packages to prop up prices. Reuters reported on Saturday that the strong market rebound in 2020 was fueled by what it called “unprecedented stimulus from the Fed.”.
The analyst and author of the Rekt Capital newsletter tweeted on tuesday that BTC “is entering a period of oversized opportunity” based on Channel of Record analysis which he says resembles what happened in March 2020. However, it’s not clear to him if we’ve hit rock bottom yet.
last time #BTC lost the Log Channel was in March 2020
this is when $BTC also dipped below the blue 200-SMA
Log Channel clearly shows BTC is entering a period of outsized opportunity
But does price need to drop as low as to the 200-SMA to completely bottom?#crypto #bitcoin pic.twitter.com/hTxwfWYdkH
— Rekt Capital (@rektcapital) May 16, 2022
The last time BTC lost the record channel was in March 2020. This occurred when BTC also dipped below the blue 200-SMA. The Register Channel clearly shows that BTC is entering a period of oversized opportunity. However, does the price need to fall as far (like the 200-SMA) to bottom out completely? #Crypto #Bitcoin pic.twitter.com/hTxwfWYdkH
At the time of writing this article, bitcoin price is up 1.1% in the last 24 hours trading at $30,545 at the time of writing.
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