Tesla fall, healthy correction and high inflation push Bitcoin lower
Last Updated on 6 November 2023 by CryptoTips.eu
Tech stocks sold off in the US this week after Tesla, the electric vehicle maker, posted very poor first-quarter results. Bitcoin followed that tech sell-off as usual and moved lower smoothly as well – the largest digital coin even went below its 20-day moving average. The last time this happened was mid-March.
Seven analists
Tesla and CEO Elon Musk have long been the star stock of the US technology exchange, but what they presented this week failed to please even their biggest fans. No fewer than seven analysts from major banks lowered their price target for the electronic automaker.
On Thursday, April 20, Tesla stock lost 9.5%, causing it to lose $58 billion in market capitalization. In the last month, it lost almost 20%.
The sky-high inflation that is still being measured in the United Kingdom is also not good news. Although the UK is the only Western European country where inflation still exceeds 10%, the bad news is that London is not getting prices under control.
Bitcoin, which continues to be highly correlated to high-risk stocks like the Nasdag and Tesla stock, also lost when this happened as investors returned to a kind of risk-off mode.
Correction
“This pullback doesn’t look positive. However, when looking at bitcoin’s yearly chart, it’s clear we have just witnessed a period of exceptional growth as the industry recovers from the crypto mishaps of the past few years,” said Sheraz Ahmed, executive director of the Crypto Valley Association.
“We could be witnessing the beginnings of an overdue but overall healthy correction, which should encourage further accumulation.”
Agreed that a small correction after a 70% growth for the Bitcoin price in the first quarter makes sense, but whether this $28,000 price will attract new buyers remains to be seen. Will we go even lower next week or is this temporary?
