The broader crypto market has entered a strong correction, with Bitcoin and altcoins continuing to face strong selling pressure. Although the S&P 500 continues with its upside, experts believe that it is entering a dangerous territory, last seen before the 1929 Great Depression, and the 2008 financial crisis. Furthermore, the rising US Dollar index could pressure risk-on assets like crypto and equities.
Crypto Market Corrects Despite Fed Rate Cuts
Earlier this week, Fed Chair Jerome Powell announced a 25-bps interest rate cut in a major pivot of the US monetary policy. The crypto market hasn’t seen much action since then, and has rather turned into a sell-the-news event. Bitcoin (BTC) has failed to give a daily close above $117,200 for sustained upside, but continues to trade under $116,000.
Onthe other hand, top altcoins like Ethereum (ETH), XRP, Solana (SOL), Dogecoin (DOGE) are all down by 5% over the past week. As per the Coinglass data, the 24-hour liquidations have soared to $283 million, of which, $242 million is in long liquidation.
Furthermore, Bitcoin (BTC) and the broader crypto market is losing its correlation with the S&P 500, which hit a new all-time high above 6,600 on Friday, September 19. Crypto analyst Ted Pillows warned that September’s triple witching expiration could trigger short-term market weakness. As a result, he predicts a 15-20% altcoin market correction, that could affect top altcoins like ETF, XRP, SOL, DOGE, etc.
S&P 500, Dollar Index Enter Dangerous Territory
While the S&P 500 continue to inch higher following the Fed rate cuts, crypto analyst Ted Pillows has raised concerns that it is now entering a dangerous territory. Commenting on S&P 500’s current trajectory, Pillows stated that the index has touched its upper trendline resistance for only the third time in history.
According to Pilows, the previous two instances coincided with the onset of the 1929 Great Depression and the 2008 global financial crisis.
Market strategist Ted Pillows noted that the U.S. Dollar Index (DXY) is rebounding from a key support level. Historically, a strengthening dollar has signaled bearish pressure on risk-on assets, including cryptocurrencies.
Nonetheless, Pillows believes that investors need to see this short-term pain moving ahead, before we begin a parabolic rally moving into Q4. Crypto market analysts are already expecting a BTC price rally to $150K by the year-end, and the start of a major altcoin season ahead.
