Bitcoin Could Test $76,300 as 'Stealth Bear Market' in Equities Threatens Rally, Analyst Says
Bitcoin may face downside to $76,300 as stock market weakness, macro uncertainty and U.S. midterms threaten its Why Is $76,300 Critical For Bitcoin’s Bull Market?The DeFi Report’s in-house analyst Mike on Wednesday said that Bitcoin remains in an early bull market, identifying its 50-week EMA near $76,300 as critical support.A drop to this level would mark a 12% correction from Bitcoin’s Oct. 4 high of $86,500, compared with two 17% corrections during the 2023 early bull market.Mike noted that roughly 25% of Bitcoin’s supply changed hands between $78,000 and $92,000, signaling significant accumulation.He also highlighted stronger profit absorption and fewer realized losses than in 2023, suggesting resilient holders and weakening selling pressure.Multiple weekly closes below $76,300 could invalidate his bullish outlook.Is a ‘Stealth Bear Market’ Threatening Crypto?Mike warned that nearly 60% of S&P 500 stocks have fallen more than 20% from their highs, while 41% are down over 30%, despite AI stocks supporting the broader index.He described this as a “stealth bear market” but suggested the weakness could signal an approaching market bottom rather than a prolonged downturn.The Nov. 3 midterm elections could trigger further volatility, although the S&P 500 has gained in the 12 months following each of the past 10 midterms.While a Democratic sweep could raise policy uncertainty, increased deficit spending could strengthen Bitcoin’s long-term investment case.Can Bitcoin and Altcoins Stage a Recovery?Mike sees improving crypto market conditions despite weak prices, noting that Bitcoin ETF holdings rose 6% between mid-August and late September before stabilizing in October.Bitcoin’s hash rate also remains within 5% of its all-time high, signaling sustained mining activity.Meanwhile, the share of top 50 altcoins outperforming Bitcoin has plunged from 96% to 12%, reflecting widespread weakness.Ethereum also continues to underperform, with the ETH/BTC ratio near 0.029, down 28% from last year’s high.Mike believes the correction could create opportunities in stronger altcoins if Bitcoin maintains its bullish structure.Preview Image: Shutterstock