As a seasoned researcher with over two decades of market analysis under my belt, I’ve seen bull runs and bear markets come and go, but never have I witnessed such a fascinating race between traditional stocks and cryptocurrencies. The S&P 500 and Nasdaq Composite Index are indeed recovering at an impressive pace, but the crypto market seems to be outpacing them.
As a crypto investor, I find myself in an intriguing position as both the U.S. stock market and the crypto market are showing signs of growth. The U.S. stock market, having navigated a V-shaped recovery following the Japanese yen carry trade crash, is nearly back to its all-time highs, suggesting this upward trend may continue. Meanwhile, the crypto market seems to be gearing up for its own recovery journey. It’s like watching two powerful horses preparing for a race – which one will cross the finish line first? The anticipation is thrilling!
S&P 500 wiping out losses fast
The graph for the past week illustrates the S&P 500 (SPX). A significant correction, as intense as the one observed during the 2023 period from July to October, appears to be rapidly diminishing. The price dropped to a level equivalent to approximately 0.786 Fibonacci, but has since been swiftly rebounding. The stochastic RSI at the base of the chart suggests that further upward momentum is imminent.
Nasdaq Composite Index upside target of $26,000
Speaking in simpler terms, much like the scenario with the Nasdaq Composite Index, it’s predicted that the index associated with tech stocks could reach approximately $20,000 at a significant Fibonacci extension level of 1.618. If this projection holds, an additional target is anticipated around $26,000.
Crypto recovery outperforming U.S. stock market
Viewing both the crypto market and U.S. stock market over the same weekly timeframe reveals a significant correction for cryptocurrencies. To be specific, this correction represents a 38% reversal, which translates to a massive $1.03 trillion decrease in value – a loss that surpasses the one observed in U.S. stocks by more than double.
In other words, it’s clear that the recent 23.5% increase in the overall crypto market has surpassed the 13.7% growth of the Nasdaq Composite Index and the 9.5% rise experienced by the S&P 500.
Is crypto about to more than double its market cap to $4.4 trillion?
It’s predicted that the overall value of cryptocurrencies could exceed the U.S. stock market in the near future. This optimistic outlook is due to the current bullish pattern, known as a ‘bull flag’, which suggests an upward price movement. If the price breaks through this flag and reaches the extended Fibonacci level of 1.618, it could potentially push the total value of cryptocurrencies to around $4.4 trillion, more than doubling its current market cap.
It seems clear that among various investment options, crypto might prove to be the swiftest contender. However, it’s crucial to acknowledge that unforeseen events (black swans) could drastically alter the situation. These events may impact all cryptocurrencies, except perhaps Bitcoin, which some view as a bet on an uncertain financial market.
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2024-08-20 14:08