Why $100K Is Off the Table If the S&P 500 Keeps Bleeding

Mar 09, 2025

In this update, I want to take a look at Bitcoin and the stock market. Overall, Bitcoin still looks solid, holding up well, but I do have concerns when I look at the broader stock market.

A sustained drop in equities would, in theory, have a major impact on Bitcoin.
Let’s start with looking at Bitcoin on its own.

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The daily chart shows higher lows, which means Bitcoin has likely already found its floor. The struggle to push higher is clear, but once it breaks free, I anticipate a solid three-to-four-week move. Such a rise would get us back above $100,000 and toward the upper end of the trading range. That’s where we’ll get a clearer sense of what Bitcoin wants to do next.

From a broader perspective, this is a normal retracement of 28% following a 100% gain over a few weeks. There's nothing unusual about this pattern—it’s just the natural rhythm of the market.

One encouraging sign is that Bitcoin held steady recently, even as the S&P 500 faced heavy selling, especially in the Nasdaq, which lost its 200-day moving average. The past week saw notable declines in the stock market. The S&P 500 started near 6,000 but lost over 5% in just five days. For an index of that scale, that’s significant.

Stocks Are Oversold

Looking ahead, the S&P 500 appears extremely oversold and overdue for a bounce. Given the current state of Bitcoin's setup, the timing lines up well for a strong recovery in both markets. Sentiment in stocks is at a low, which often sets the stage for a rebound. If that plays out, Bitcoin should benefit, putting in a solid stretch of green candles.

There are also positive developments on the regulatory front. Discussions around crypto-related policies are progressing, and while much of that has already been priced in, it’s still good to see these conversations happening for the long term adoption in Bitcoin.

Concerns About a Broader Market Downtrend

My primary concern remains with the S&P 500. There are signs that we might be entering a more prolonged downtrend. The key issue is a break of the weekly uptrend- something we haven’t seen in a while. Historically, when this happens, it suggests that a deeper correction is underway. This is the first time in this uptrend, which began in October 2022, that we've seen this type of price action.

If the S&P 500 does indeed move lower over the coming months, it raises questions about how Bitcoin will react. While some argue that Bitcoin could break free from stocks and behave more like gold as a safe-haven asset, history suggests otherwise. Bitcoin has typically moved with risk assets. If stock markets face a serious decline, it’s hard to imagine Bitcoin completely ignoring that.

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That being said, we can’t rule out surprises. The stock market could stabilize and chop around for months before resuming its upward trend. If that happens, Bitcoin could perform well in a sideways stock environment. But as someone managing risk, I have to consider the worst-case scenarios.

Strategy Moving Forward

My strategy at this point is to wait for a bounce in the stock market, which should coincide with an even stronger move in Bitcoin. I am not looking to sell into this recent decline. I prefer to wait for a push higher—potentially above $100K—before reassessing my stance. At that point, I would consider shifting a portion of holdings into cash to see how equities perform.

If Bitcoin can push above $108,000 and hold, then we can take that as confirmation that it has weathered the storm and is ready to continue higher. But that assumes we get there in the first place.

Final Thoughts

Overall, while this isn’t the best environment, it’s not outright bearish for Bitcoin just yet. The equity market’s influence is the main wildcard. There’s a possibility that stocks recover and Bitcoin follows suit, but I remain cautious. I’ll be watching closely for confirmation before making any major moves.

That’s the update—thanks for reading!

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