While cryptocurrency traders and enthusiasts are moaning about the bear market, stocks are no different. The stocks of the most important tech companies have also turned to negative numbers these last days. It would seem that there is a correlation between these two markets. The truth is that only shorters can be happy with this market climate.
Bear Market For Tech Stocks
Cryptocurrencies are often referred to as the most volatile assets ever. And in a way that is correct. The astounding and worrying drop tat the prices suffered yesterday is a proof of that. But the stock market does not stay far behind. In fact, it has also been a bear market, more for tech stocks. The FAANG stocks, called like that by the initials of every stock, are also down. Facebook, Amazon, Apple, Netflix, and Google are also facing heavy losses this week.
The five stocks lost more than twenty percent each, with Facebook losing more than 40% of its value. This stock, in particular, has been hit by criticism about election influence and privacy concerns. The price of the Facebook stock is now lower than in last year’s January.
Apple, the once called unbeatable stock, lost more than 24% of its initial valuation, with Goldman Sachs also modifying its forecast for their price at year’s end. Analysts have said that this bear market is being caused by the weak demand that Apple products have in China. The new prices and products failed to get the Chinese audience excited.
The other stocks also fell more than 20% each, numbers that make this officially a bear market.
Bear Market For Cryptocurrency Too
However, the cryptocurrency market is also facing deep losses, albeit for different reasons. Most analysts are sure this bear market is a result of the bitcoin cash hark fork. This event that triggered a selloff that has taken bitcoin to a sub $5K level, threw the market into disarray. However, everything is not so simple, as some see a correlation.
Mati Greenspan, of eToro, declared that it is “impossible to shake off the feeling that somehow the current sell-off in tech stocks is somehow related to what we’re seeing with the cryptos.” And this is indeed consistent with the graphics that indicate the two drops produced at the same days. It could be that whale investors are diversified and have also withdrawn their funds from the stock market.
Be it as it may, cryptocurrencies pulling stocks down or the opposite, these drops are causing major losses to institutions, companies, and individuals. And it is uncertain when it is going to stop.