Yesterday, the Bitcoin (BTC) market, cryptocurrencies, and tech stocks saw a notable correction, turning red and raising questions about the strength of the recent bullish trend.
Far from a general panic, this fall presents a consolidation scenario that analysts assess as follows: Potentially a strategic entry opportunity for investors with a long-term vision.
Bitcoin, the largest digital asset by market capitalization, hit an all-time high of $126,000 in early October last year. However, the digital currency began to gradually decline, falling to its lowest point of $98,700 yesterday. This was after the market crash.
Despite this downward trend, Bitcoin has shown resilience and partially reversed the trendcurrently trading at $103,400. This move, reported by CriptoNoticias, is interpreted as a natural correction rather than a change in the underlying trend, suggesting that the fundamentals are intact.
Tech stock decline pattern continues
The technology sector is experiencing a similar movement with cryptocurrencies. Companies with large exposure to Bitcoin, Like Strategy, the company's stock price fell from $365 to $248 per share.which represents a decrease of approximately 32.19%.
Quantum computing company D-Wave Quantum suffered a similar crash. The stock is now trading at $30.7 per share, up from a peak of $46 per share in mid-October.down nearly 33.26%. Even Intel Corp. saw a correction after peaking above $42 in late October, returning to levels around $38.
But experts see this correction as an opportunity. “For investors with access to liquidity, especially those looking to invest for the long term, the recent market correction looks like a buying opportunity,” said Robert Edwards of Edwards Asset Management.
He added: “Earnings have far exceeded expectations and are growing faster than sales, often leading to higher multiples.”
Institutional Investor and Trader Perspectives on the Collapse
The sense of correction as an opportunity for accumulation is reflected in the remarks of traders like David Battaglia, a Venezuelan who explained his philosophy in the face of the decline: “The market bleeds. Our business is to buy red candles. Our business is the future.”
Battaglia Distinguish between a professional approach and panic-driven investing, “People who cry buy according to algorithmic trends on social networks. We buy because there is a theory behind each asset in our portfolio.”
He also said, “They are trying to trap you by emphasizing the nature of a market collapse. Markets don't go down 'out of fear,' they go down to scare you into holding your position.” He concluded, “When everyone panics and sells, those who understand will gather. Time is ticking and opportunities don't wait.”
However, according to data collected by Bank of America and reported by CNBC, Large investors sell large sums of money.
The network reported that “hedge funds and other large investors are selling tech stocks at the fastest pace since July 2023” and that net sales of individual stocks in the sector “surpassed $5 billion last week.”
The recent decline in Bitcoin and the technology sector highlights the inherent volatility in these markets. However, the prevailing view among analysts is that: As long as growth fundamentals remain strong, the current correction means unwinding of positions. And a potential accumulation opportunity for those looking long term.
The key will be whether the market can sustain current levels and resume its uptrend once the current selling sentiment dissipates.
