Bitcoin's 3.2% Drop, GDP Slowdown Signal U.S. Stock Market Decline

The recent analysis of Bitcoin and technical indicators suggests that the U.S. stock market is poised for further declines. The e-mini S&P 500 index futures have seen a rebound that has stalled at a downward trend line, which has been tested multiple times over the past ten weeks. This, combined with Bitcoin's 3.2% drop from its high point last Friday, may convince short-term traders to bet on further declines in the U.S. stock market this week.

For a cryptocurrency, a 3.2% pullback might not seem significant, but it is the largest peak-to-trough decline for Bitcoin since it fell approximately 10% on April 15/16. This could encourage retail investors to believe in the bearish technical pattern of the e-mini futures. Additionally, a series of negative outlooks for Wednesday's U.S. GDP data could exacerbate the situation. The consensus forecast for the 2025 growth rate is expected to drop to 1.43% on Friday, down from a peak of 2.3% two months ago when the market was optimistic about President Trump's early promises to make America great again.

The first-quarter GDP is expected to grow by 0.4% quarter-on-quarter, compared to 2.4% in the previous quarter. Given that this slowdown occurred before Trump's announced "liberation day," the deceleration is substantial. This economic slowdown, coupled with the technical indicators and Bitcoin's price movements, suggests that the U.S. stock market is likely to continue its downward trajectory. Investors should closely monitor upcoming economic data releases, as these factors will play a critical role in shaping market sentiment and price movements in the coming weeks.