- The BTC/GBP price plunged to the lowest point since January 21.
- Bank of America analysts warned about the upcoming US inflation data.
Bank of America (BofA) analysts have a major warning for the equities market. And the warning could spread to the crypto market, which is reeling from a staking crackdown in the US. The BTC to GBP price drifted to a low of 18,000, lower than the year-to-date high of 19,679. Similarly, ETH/GBP dropped to 1,271, lower than the year-to-date high of 1,403.
BofA warning on equities
American stocks have been in a remarkable rally this year, with the Nasdaq 100 index up by over 15%. Tesla shares have also jumped, bringing Elon Musk’s net worth to about $186 billion. These gains, however, have faded recently as investors worry about the Fed now that the US published blemish-free jobs numbers.
In a report, analysts at Bank of America said that the upcoming American inflation data will likely be a turning point for American stocks. The bank recommended that investors should sell the S&P 500 index at $4,200. This price is about 3% above the current level.
The argument is that American companies are seeing weak earnings and that next week’s inflation data could signal that prices are stubbornly high. Combined with the strong labor market, there is therefore a likelihood that the Federal Reserve will maintain its hawkish posture.
Read more: Find out the best Bitcoin exchanges.
BofA’s warning was targeted at the stock market. However, based on the close correlation between stocks and crypto, it has ramifications for the industry. For one, this year’s rebound of stocks has coincided with a comeback in the crypto market.
Bitcoin price faces other challenges as well. In a statement on Thursday, Kraken paid $30 million and ended staking in the US. This is a signal that the SEC is taking a more aggressive tone in regulating cryptocurrencies after the collapse of FTX and Terra.
BTC to GBP price technical analysis
The 4H chart shows that the BTC/GBP price has made a bearish breakout in the past few days. It crashed to a low of 17,895, the lowest point since January. This decline happened after the Bitcoin price formed a rising wedge pattern. In price action analysis, a rising wedge is usually a bearish sign. Bitcoin moved below the key support at £18,224, the lowest point on January 30.
Therefore, the BTC to GBP price will likely continue falling as sellers target the key support at 16,511. This price is about 8.65% below the current level.
