The shares may fall a further 20 percent. And BTC?

JP Morgan CEO Jamie Dimon predicts another 20% single drop for the S&P 500 from today’s levels, taking into account global macroeconomics. How will Bitcoin react?

In an interview with CNBC, Jamie Dimon said that the United States and the world will likely be pushed into a recession six to nine months from now. He predicted that the S&P 500 could fall “another easy 20%” from today’s levels. He added, “the next 20% would be much more painful than the first.”

How accurate were previous Dimon predictions?

Society believes that Jamie Dimon is known for predict Fear, uncertainty and doubt (FUD). He is wrong most of the predictions. Earlier in April 2020, he predicted a bad recession in his annual letter to shareholders. They stopped the buyback of JP Morgan shares. The stock then rose 52% from April 2020 to April 2021.

In his April 2021 annual letter to shareholders, he said that “the pandemic will end with a U.S. economic recovery, the U.S. economy will likely boom,” adding, “This boom could easily go into 2023.” The opposite happened. Today’s economy is in a worse state than in April 2021.

The markets will get the answer in 6 to 9 months if the index will fall by another 20%.

What does the diagram say?

Is there any similarity between the 2008 chart of the S&P 500 and the 2022 chart? In 2008, when the index was down nearly 10% from its all-time highs, it tested the 200-day Simple Moving Average (SMA). It was a head-and-shoulders formation, and the index broke the neckline in June 2008.

After that, the market saw a steep drop of almost 50% before bottoming out.

Also in 2022, when the S&P 500 retested the 200-day SMA, it was down approx. 10-12% from all times. The index formed a similar head-and-shoulders pattern after taking a rejection from the 200-day SMA. The neckline was broken in September 2022. Is the market on the verge of a steep downward movement?

The impact on BTC

If Dimon’s prediction of another 20% drop turns out to be accurate, the community fears that it will have an impact on crypto. There is a high correlation between the S&P 500 and BTC. The effect multiplies when it comes to Bitcoin. From February to March 2020, when the S&P fell by 35%, Bitcoin’s price fell by more than 60%. Currently the S&P is down almost 25% from its ATHs and Bitcoin is down more than 70%

If the S&P 500 falls 20%, Bitcoin could see more than 50% downside from current levels. Some traders feel this could be a buying opportunity.

Is the JP Morgan boss on the money this time?

For Be[In]Crypto’s latest Bitcoin (BTC) analysis, click here