The bitcoin (BTC) market, cryptocurrencies and tech stocks saw a notable correction yesterday, turning red and raising questions about the strength of recent bullish trends.
This fall, far from being a general panic, presents a consolidation scenario that analysts evaluate as a possible strategic entry window for investors with a long-term vision.
The largest digital asset by capitalization, bitcoin, hit an all-time high of $126,000 at the beginning of last October. However, the digital currency began a path of gradual decline that took it to a minimum point of $98,700 yesterday. This, after the market crash.
Despite this downward movement, bitcoin has shown resilience and has partially reversed the trendnow trading at $103,400. This movement, as reported by CriptoNoticias, is interpreted as a natural correction and not as a change in the underlying trend, suggesting that the fundamentals remain intact.
Tech stocks continue falling pattern
The technology sector has experienced movements similar to cryptocurrencies. Companies with significant exposure to bitcoin, like Strategy, saw their shares fall from $365 per share to $248which represents a decrease of approximately 32.19%.
D-Wave Quantum, a quantum computing company, suffered a fall similar, going from its peak of $46 per share in mid-October to now trading at $30.7a drop close to 33.26%. Even Intel Corporation experienced a correction after reaching a peak above $42 at the end of October, returning to levels around $38.
This correction, however, is seen by specialists as an opportunity. Robert Edwards of Edwards Asset Management commented: “For investors with available liquidity, the recent market correction seems like a good time to buy, especially for those with a long-term investment horizon.”
He added that “earnings are far exceeding expectations and growing faster than revenue, often leading to expanding multiples.”
The perspective on the collapse of institutional investors and traders
The sentiment of correction as an opportunity for accumulation is reflected in the statements of traders such as the Venezuelan David Battaglia, who He explained his philosophy in the face of the fall: “the markets bleed. Our business is buying red candles. Our business is the future.”
Battaglia differentiated the professional approach from panic-driven investing, pointing out: “those who cry bought following algorithmic trends on social networks. We buy because we have a thesis for each asset in our portfolio.”
He also emphasized the nature of the market collapse by indicating: “they are making you fall into a trap, the market does not fall because of ‘fear’, it falls to scare you and keep your positions,” and concluded: “When everyone sells out of panic, those who understand accumulate. The clock is ticking, and opportunities do not wait.”
However, data collected by Bank of America and reported by CNBC show that large investors have been making significant sales.
The network reported that “hedge funds and other large investors are selling technology stocks at the fastest pace since July 2023,” with net sales of individual stocks in the sector “exceeding $5 billion last week.”
The recent sell-off in bitcoin and the technology sector underscores the volatility inherent in these markets. However, the dominant perspective among analysts is that, As long as growth fundamentals remain firm, the current correction represents a clearing of positions and a potential accumulation opportunity for those looking at the long term.
The key lies in the market’s ability to sustain current levels and resume the uptrend once the current selling sentiment dissipates.