Bitcoin briefly surged past $98,200 on Friday, marking a 70-day high before retreating into a short-term correction over the weekend. The pullback, though modest, highlights growing caution in the market amid lean liquidity and rising macroeconomic uncertainty.
Bitcoin Stalls Below $98K Amid Low Weekend Trading Volumes
On Sunday, May 4, Bitcoin dipped 0.7%, slipping below $96,000 for the first time since midweek. This marks the second consecutive day of losses following a strong institutional-led rally that had propelled BTC to near $98,200 earlier in the week.
While Bitcoin briefly reclaimed a $2 trillion market capitalization—a psychological and technical milestone—its upward momentum has stalled. The resistance near $98,000 has proven difficult to breach, especially without strong macro tailwinds or major catalysts.
On a weekly basis, Bitcoin remains up 4.5%, with a solid 12.8% gain over the past 30 days. This strength is underpinned by consistent inflows into spot Bitcoin ETFs and renewed accumulation activity by U.S. corporate treasuries—a sign of long-term confidence in BTC as a balance sheet asset.
However, short-term headwinds are emerging. Ethereum’s failure to sustain momentum above $1,900, coupled with declining futures trading volumes on major platforms like Binance and CME, reflects broader risk-off sentiment during the weekend session.
Tom DeMark Warns of Imminent U.S. Stock Market Top
Tom DeMark, the renowned technical analyst and creator of the widely followed TD Sequential indicator, has issued a stark warning: a major top in U.S. equities may be forming, potentially leading to a bear market within months.
DeMark, whose models accurately predicted the February 2025 peak and April bottom in the S&P 500, points to clear signs of technical exhaustion in the index. His analysis suggests that just two more closing highs in the S&P 500 would complete a 9-count TD Sequential setup—an historically reliable signal for trend reversals.
Once triggered, DeMark anticipates a significant correction, with the index likely to retrace below 4,835—the intraday low seen in April—which would represent a drop of more than 20% from February’s highs.
“A top is imminent. Too much technical damage has been done,” DeMark stated.
He notes, however, that this outlook could shift if there are meaningful improvements in global trade dynamics or liquidity conditions—factors that could temporarily extend the current rally.
Bitcoin’s $100K Target Hinges on Market Correlation Shifts
The relationship between Bitcoin and traditional financial markets—particularly the S&P 500—has become increasingly relevant in 2025. While Bitcoin once positioned itself as a decoupled digital asset, recent data shows its correlation with equities has surged to 0.82.
This heightened correlation implies that BTC is now more sensitive to movements in U.S. stocks than at any point earlier this year.
Earlier in February, when geopolitical tensions escalated due to retaliatory tariffs from China, Bitcoin’s correlation with the S&P 500 dropped to a yearly low of 0.27. During that period, BTC acted as a partial hedge, drawing investor interest amid equity market declines.
But with former President Donald Trump softening his stance on tariffs and advocating aggressively for Federal Reserve rate cuts, broader risk appetite has improved—pulling Bitcoin back into sync with equities.
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Scenarios Ahead: Hedge or Risk Asset?
The critical question now is: How will Bitcoin behave if DeMark’s predicted equity correction unfolds?
The answer depends largely on the underlying catalyst:
- If the downturn stems from trade policy shifts or geopolitical flare-ups, Bitcoin could reassert its role as a macro hedge. Historical patterns show BTC tends to perform well during periods of monetary easing and global instability.
- If the decline is driven by systemic risks—such as a full-blown recession, financial contagion, or an energy supply shock—Bitcoin may not escape unscathed. In such environments, investors typically de-risk broadly, selling off even non-traditional assets like cryptocurrencies.
In short: Bitcoin’s path to $100K is still open—but it’s no longer immune to macro storms.
Key Factors Influencing Bitcoin’s Near-Term Trajectory
Several interrelated forces are shaping Bitcoin’s price action:
- ETF Inflows: Continued demand from spot Bitcoin ETFs signals sustained institutional interest.
- Corporate Treasury Activity: U.S. firms adding BTC to reserves reinforce its long-term value proposition.
- Macro Policy Expectations: Anticipated rate cuts and fiscal stimulus could fuel risk-on behavior—or trigger inflation fears.
- Market Liquidity: Thin weekend volumes amplify volatility and make breakouts harder to sustain.
- Technical Resistance: The $98K–$100K zone remains a formidable barrier requiring strong conviction to breach.
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Frequently Asked Questions (FAQs)
Q: What caused Bitcoin’s recent price pullback?
A: The dip below $96,000 was driven by reduced weekend liquidity, profit-taking after the $98,200 high, and growing caution amid rising macro uncertainty.
Q: How strong is Bitcoin’s correlation with the S&P 500 right now?
A: As of early May 2025, the correlation stands at 0.82—indicating that Bitcoin is closely tracking movements in U.S. equities.
Q: Who is Tom DeMark and why does his analysis matter?
A: Tom DeMark is a veteran technical analyst known for developing the TD Sequential indicator. His track record in predicting major market turning points gives his bearish outlook significant weight among institutional traders.
Q: Can Bitcoin still reach $100,000 despite macro risks?
A: Yes—but its ability to do so depends on whether equity market weakness stems from policy shifts (bullish for BTC) or systemic economic stress (bearish).
Q: What would support Bitcoin during a stock market downturn?
A: If the downturn is tied to inflationary pressures or geopolitical events, Bitcoin could attract safe-haven flows. Monetary easing would further support its appeal.
Q: What could cause Bitcoin to fall alongside stocks?
A: A deep recession, banking sector instability, or sudden liquidity crunch could force investors to sell all risk assets—including Bitcoin—in favor of cash or bonds.
Final Outlook: $100K Still Possible—but Macro Winds Are Shifting
Bitcoin’s journey toward $100,000 remains intact, but the road ahead is increasingly shaped by forces beyond crypto-native developments. With institutional adoption strengthening and ETF inflows steady, the long-term fundamentals are sound.
Yet, Tom DeMark’s warning serves as a timely reminder: in today’s interconnected markets, no asset trades in isolation.
Whether Bitcoin breaks out or pulls back will depend less on on-chain metrics alone—and more on what drives the next move in global equities. If macro conditions deteriorate due to structural economic weakness, even BTC’s $2 trillion valuation could come under pressure.
Conversely, if volatility arises from policy uncertainty or trade tensions, Bitcoin may finally cement its status as digital gold—rising because traditional markets fall.
For now, traders should watch both the $98K resistance level and key equity indicators closely. The next major move—up or down—could be triggered not by a crypto headline, but by a shift in Wall Street sentiment.
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