Thursday morning, Bitcoin began with a drop and has been following this trend throughout the day. At the time of writing the article, the BTC price is trading near $28,495.
According to CoinMarketCap, which tracks virtual asset quotes, over the past day, Bitcoin reached the daily high of $29,195, and the low of $28,376.
Meanwhile, the past week has been extremely unfavorable for the first cryptocurrency. The pessimism of the digital currency king has also been adopted by the top 10 coins by market capitalization, most of which have also significantly decreased in price.
The main factor exerting pressure on the digital currency market this week has been the continuous decline in the US stock markets. For example, on Wednesday, the Dow Jones Industrial Average index slumped by 0.52%, the S&P 500 lost 0.76%, and the NASDAQ Composite dropped by 1.15%.
Interestingly, economists note a decrease in the correlation between the cryptocurrency and stock markets in the current year due to the ongoing flat movement of Bitcoin's price.
This was reported by analysts from the American investment company Bernstein at the end of February. In the past month, the correlation between BTC and the NASDAQ Composite index dropped from 0.94 to 0.58.
According to Bernstein, the cryptocurrency market has been balancing between bullish and bearish trends lately, awaiting further catalysts. However, its sensitivity to important news and events in the financial world has significantly decreased.
Recalling the beginning of 2022, analysts often emphasized the high correlation between the American stock market and the digital asset market due to the tense anticipation of the geopolitical conflict in Eastern Europe and further steps by the US Federal Reserve. In the middle of last year, investment company Arcane Research stated that the correlation between BTC and tech securities had reached its peak since July 2020.
TradingView also claimed that the correlation between the cryptocurrency market and the US stock market in the fourth quarter of 2022 was 70%.
Altcoin market
Ethereum, Bitcoin's main competitor, also started Thursday with a drop and continues to follow this trend throughout the day. At the time of writing the article, the coin is trading at $1,786.
Regarding analysts' forecasts for Ethereum's near-term prospects, they suggest that the future trend of the altcoin will depend on whether the coin falls below $1,600 or rises above $1,950.
As for the cryptocurrencies in the top 10 by market capitalization, all the coins traded in the red zone over the past day. The worst results were recorded for Dogecoin (-4.02%).
For the past week, among the top ten cryptocurrencies, all the coins also reported a decrease. Dogecoin (-10.14%) topped the list of decreases.
According to CoinGecko, the largest aggregator of virtual asset data in the world, over the past day, the top gainer among the top 100 most capitalized digital assets was Rocket Pool (+4.16%), and the top loser was Sei (-13.59%).
Based on the past week, within the top 100 strongest cryptocurrencies, the worst results were demonstrated by the digital asset GMX (-19.60%), while the best was the aforementioned Sei (+2362.56%).
According to CoinGecko data, as of Thursday evening, the total market capitalization of cryptocurrencies is above the important key level of $1 trillion, amounting to $1.102 trillion. Over the past day, this indicator decreased by 0.26%.
Since reaching its peak above $3 trillion in 2021, the cryptocurrency market capitalization has lost more than $2 trillion.
As a rule, August is considered an unlucky month for Bitcoin. Over the past 12 years, BTC has ended this month with an increase only in five cases and a decrease in seven.
The average August increase is around 26%, while the decrease is 16%. If the flagship cryptocurrency decides to replicate the approximate performance of previous years this August, it could rise to $36,800, reaching the highs of the year, or plummet to $24,500, setting new lows for June.
In the past July, Bitcoin showed a 4% decrease, ending the month at around $29,200. In June, the price of BTC surged by 12.1% to $30,400. In May, Bitcoin decreased by 7.6%, closing the month at $27,100. In April, BTC lost nearly 10%. In the past March, the coin's price surged by 22.6%, marking the third consecutive month of growth amid the normalization of the situation surrounding the banking crisis.
In the previous February, the first cryptocurrency ended with a 0.9% increase, reaching $23,200. In the first month of 2023, it gained nearly 40% in price, making January the best month for BTC since October 2021. Notably, January to March of this year was the best quarter for the coin since the beginning of 2021, and BTC became one of the most profitable assets.
The key reason for the rise of the digital currency market since the beginning of 2023 has been the impending crisis in the traditional financial market. Today, securities and bonds are going through a rather difficult period. This is precisely why we are observing a continuously growing desire of investors worldwide to invest in digital currencies.
