Bitcoin Due to Turmoil vs Gold, Stocks as BTC Price Drops Below $22.5K

Bitcoin (BTC) saw weakness at the Wall Street open on Jan. 25 as US stocks fell into line.

BTC/USD 1 hour candlestick chart (Bitstamp). Source: TradingView

BTC price is facing stiff resistance

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD fell below $22,500 after failing to break resistance near the five-month highs.

US equities had a weak start to the session, with the S&P 500 and Nasdaq Composite Index down 1.1% and 1.6% respectively at time of writing.

Bitcoin bulls themselves had run into problems trying to get into a liquidity area above $23,400, this has remained unchallenged so far and home to a significant number of possible short liquidations.

Traders remained on the fence, hoping for a clearer trading signal after several days of essentially sideways price action.

“This is what I am looking for on Bitcoin with a corrective wave now followed by another leg up to my $25,000 total,” Crypto Tony noticed next to an explanatory chart.

“Invalidation is if we start to collapse from here.”

BTC/USD annotated chart. Source: Crypto Tony/Twitter

Cointelegraph employee Michaël van de Poppe also chose to wait for the day.

“Patiently waiting for Bitcoin to drop or break below $22.3K and recover $23.1K. In between, I don’t see much of an interesting set-up,” he said told Twitter followers.

Some optimistic recordings remained, including Crypto Ed’s, which eyes a potentially higher low for BTC/USD paving the way for new highs.

Even fellow trader Kaleo suggested that $30,000 would be Bitcoin’s next target.

Bitcoin correlation with gold spike

An interesting topic beyond price action, meanwhile, focused on Bitcoin’s correlation with both gold and stocks.

Related: Bitcoin faces ‘significant danger’ from the Fed in 2023 – Lyn Alden

Charles Edwards, CEO of crypto investment firm Capriole, noted that Bitcoin continued its historic tendency to overtake gold.

“There is a relationship between Bitcoin and gold and gold is pumping,” he says wrote.

“If you are behind the gold price, it is easier to see. Bitcoin tends to rise between 0-6 months after gold and fall 0-3 months after gold. This gap is approximate and will likely shrink over time.”

BTC/USD vs XAU/USD annotated chart. Source: Charles Edwards/Twitter

Bitcoin’s correlation to gold was practically 100% that day.

BTC/USD vs XAU/USD chart. Source: TradingView

Conversely, Kaleo was hoping for a “decoupling” from the S&P 500, with Bitcoin poised to break to the upside.

“BTC broke above HTF resistance dating back to the November ’21 ATH ~ two weeks ago,” said another tweet.

“It looks like it is poised to continue that trend as it is currently on the verge of breaking out of a pennant it has built up in excess support.”

BTC/USD vs S&P 500 Annotated Chart. Source: Kaleo/Twitter

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