• Wed. Jun 22nd, 2022

US macro pressure responsible for entire Bitcoin downtrend

ByHazel R. Lang

Jun 8, 2022

Multiple selling trends have been recorded in bitcoin since the December 2021 crash. These sellings have been responsible for the price decline recorded in the digital asset over the past two months. Naturally, selling trends can be recorded in their magnitude based on when a particular region’s trading hours are open. This time around, it seems macroeconomic pressure in the US market is to blame.

US traders push sales

The selloffs of the past two months have been particularly brutal and have driven values ​​down since the start of the year. However, it appears that most of the selling took place during daytime trading hours in the United States. This is evident by looking at year-to-date values ​​during US trading hours versus European year-to-date value. The stark contrast reveals where most of the sales took place.

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As it stands, year-to-date values ​​during US trading hours have turned negative. It stands at -32.55% while its European counterpart is considering positive values ​​since the start of the year of +16%. What this shows is that the selloffs over the past couple of months have come primarily from US traders. This is even in comparison to Asian trading hours which also show a more favorable cumulative value compared to the United States.

BTC sell-offs intensify during U.S. trading hours | Source: Arcane Research

Above all, this is evident due to the strong correlation between bitcoin and the equity market over the past couple of months. It’s also worth noting that US traders aren’t the only ones using macro markets to gauge their bitcoin risk. Since traders in other regions also use stock markets such as the NASDAQ and S&P500 to gauge their risk appetite, they can also sell bitcoin during US trading hours.

Bitcoin during trading hours

Recently, it has become apparent that there has been a lot of selling after the opening of the US markets. This translates to the fact that the price of the digital asset tends to rally in the wee hours of the morning as the European and Asian markets are open. However, once US markets open for the day, downtrends are usually apparent.

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This places bitcoin’s current low point during times when US traders are active. As such, these trading hours could present a buying opportunity for interested parties, and even a way to execute quick short-term plays for quick wins.

TradingView.com Bitcoin Price Chart

BTC recovers ahead of U.S. trading day | Source: BTCUSD on TradingView.com

However, it is important to note that the tide can change at any time. Sales can often stop as dramatically as they started. Thus, a change in trend during US hours can affect short-term games that respond to heavy sell-offs in trading hours.

The price of the digital asset recovered above $30,000 in the early hours of Wednesday at the time of this writing. If the selling trends continue, bitcoin price could drop below this level before the end of the day.

Featured image from Bitcoinist, charts from Arcane Research and TradingView.com

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