The number of negative macroeconomic factors in play can be eye-opening. The rise of the Omicron variant, continued COVID-related labor/supply chain issues, talk of rising interest rates, and the highest inflation levels in decades have all weighed heavily on investor sentiment. This has led to a downturn in the markets, including the S&P 500, which dipped over 10% in January.
Bitcoin (BTC), of course, has not been immune to bearish sentiment plaguing the rest of the investing world. After reaching an all-time high of $67,582 in early November, it has been in free fall ever since. Until the past two weeks, that is.
It appears, at least for now, that Bitcoin has found its bottom; on January 22nd, Bitcoin traded as low as $35,000. Since then, it’s been on an upswing, recently trading above $38,000 and climbing. The question is whether this rally is sustainable, given none of the macroeconomic downtrends above have been resolved.
One factor that shows investor sentiment is turning is the rebound in the S&P 500, which has regained nearly half of its losses from January over the last week; this coincided with the uptick in Bitcoin. Whether investors believe the situation is getting better or not remains to be seen.
Bitcoin last traded at $44,602.80, down -6.56% YTD.