The United States stock market is now officially in a bear market. This is the quickest move from an all-time high to a bear market ever for the S&P 500.
By all metrics, U.S. stocks are now officially in a bear market. It took us just 16 days to get here — a new record.
Headlines across the financial press today bore the fear that we had been anticipating but did not expect would happen so soon. After a sharp string of losses, the Dow has fallen some 20 percent from its peak in mid-February.
Many companies are reporting that earnings this year will be anemic. Sectors like tech manufacturing, airlines, cruise operators, and others will find that their profits will be drying up this year. Altogether, this has investors spooked.
The coronavirus has truly been the black swan event that no one expected. Coupled with the ongoing oil price war, one can easily see why economic projections are looking grim. When BeInCrypto covered possible black swan events in May, 2019 a global pandemic was not even in the cards — frankly, no one was prepared.
For months now, President Trump has been trying to pump the stock market by pushing enthusiasm higher and higher. His recent address, however, was simply not enough to calm investors.
What’s possible now is a prolonged recession.
The leading cryptocurrency, Bitcoin, has demonstrably proven that it has failed as a store of value and hedge against market uncertainty. Bitcoin is currently struggling to keep the $5,000 price point and is down some -36 percent on the daily. Its market capitalization has dropped below $100 billion.
As of now, there are a few possibilities for a reversal. However, it’s undeniable that Bitcoin is simply following the stock market and multiply its losses many times over.
In all, we are in a bear market—and the cryptocurrency space is in serious danger of falling into yet another winter. If that is the case, we can expect more pain on the horizon as Bitcoin struggles to find a bottom.