Bitcoin is down more than 10% for the day. It declined more than 14% earlier and could still decline further. So, the big question is, “Is this correction over?”. The answer for the most part is, “Yes, it is over”. Please note that “over” does not mean that it cannot go down lower. The situation with stock markets across the globe is still too volatile and we could see big swings either way. However, the damage is done and the purpose is served. A lot of Bitcoin (BTC) has changed hands and there is nothing much to gain from dragging the market lower from a market maker and whale’s perspective.

That being said, these moves are meant to instill fear in the market and we may continue to see them for a while. Funding rates on many futures exchanges are too attractive and encouraging traders to go long. We need to be careful jumping into the market just yet and going blindly long on the market, but at the same time there is no reason to be overly bearish and expect BTC/USD to decline to $1k at this point. I still stand by my target and I think we will go that low but I don’t expect it to happen at this point. I think the markets are more likely to recover in the next few weeks. The Fed’s injection of $1.5 trillion in the markets is likely to pump the S&P 500 (SPX) up in the near future during which time Bitcoin and the rest of the crypto market might also rally.

The cryptocurrency market is a very small market and it does not even matter in the grand scheme of financial developments. The forex market, the stock market and the bond market are what really matter. The daily chart for EUR/USD shows that we are now in a decision point of two decades within this market. We saw a decade of uptrend in the pair starting in 2000 culminating in 2010 and then another decade of downtrend. We have yet to see which way the market is going to swing for the next decade. No matter which way it swings, it is going to have important complications for financial markets.

Bitcoin and the rest of the cryptocurrency market is likely to be affected the most by this decision as movements in the US Dollar directly impact the price of Bitcoin. The near-term outlook of the pair remains bearish but we might see a reversal in a few weeks which could temporarily push it higher. The stock market might also rally at the same time. However, we have a lot of important geopolitical developments in the making that could shape the direction of this forex pair and therefore of Bitcoin in the future. The price of Bitcoin could fall further from here but this correction for the most part is over and the market is expected to recover quickly even if it falls further.