US Stock Market Drop Drags Bitcoin (BTC) Down: What’s Next?

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Ah, the S&P 500, that grandiose beast of Wall Street, took a tumble on Friday, plummeting a staggering 1.71%. This little dance of despair resulted in a loss of nearly $900 billion—yes, billion with a “B”! Meanwhile, the Nasdaq, in a fit of jealousy, decided to drop 2.2%, erasing up to $650 billion from its coffers. All in all, a delightful $1.5 trillion vanished into the ether, marking the worst day of 2025. Naturally, our dear Bitcoin (BTC) couldn’t keep its head above water, sinking down by 2.7%. What a spectacle! What could possibly happen next? 🤔

S&P 500 trend is still up

Now, if we peer into the crystal ball of the weekly chart for the S&P 500, we see a rather dramatic dip. But fear not! If the US traditional markets decide to open with a bang on Monday, this dip might just be a healthy little retest of the $6,000 horizontal support level, along with the ever-mysterious 0.382 Fibonacci. Who knew numbers could be so exciting? This could even turn out to be bullish—imagine that! 🐂

Should the dip decide to take a deeper plunge, the 0.618 Fibonacci awaits at $5,900, while the 0.786 Fibonacci lounges at $5,850, right next to the bottom of the ascending channel. Ah, the ascending channel, a loyal companion since early 2023, only interrupted by the shocking Japanese Carry Trade crisis in August 2024. What a drama! 🎭

So, until the price decides to leap out of this ascending channel, the trend remains decidedly upward. With President Trump cozying up to the Federal Reserve and advocating for a looser monetary policy, and with massive debts looming like a dark cloud, more currency printing is likely to send the S&P 500 soaring to even greater heights. Up, up, and away! 🚀

Another breakout attempt this week?

Now, let’s turn our gaze to the short-term time frame for Bitcoin, where the descending wedge has decided to broaden its horizons. Within this wedge, the price is still bouncing around like a hyperactive child, but now it’s doing so along the top of the 0.5 Fibonacci. With momentum indicators looking like they might just wake up from their slumber, the bulls could very well attempt another charge at the upper descending trendline of the wedge early this week. Charge! 🐂💨

If the bulls manage to pull off this daring breakout, a higher high above $99,500 will be their first target. From there, they must set another higher low, and then—oh, the sweet taste of victory!—the downtrend can finally be broken. 🏆

Weekly bullish divergence

As we gaze upon the weekly chart for the price of $BTC, we observe that the last three weekly candles are sporting the same length top and bottom wicks. This is a clear sign of the ongoing tug-of-war between the bulls and the bears, each vying for supremacy. Who will win? Place your bets! 🎲

Moreover, the fall in the Stochastic RSI is diverging from the general rise in price action since the dawn of 2025. This bullish divergence, coupled with a potential cross-up of the indicators in the Stochastic RSI, could very well be the fuel for the next big rise. Buckle up, folks! 🚀

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2025-02-24 13:09