Bitcoin could decline to around $23,980 if the U.S. stock market were to drop by roughly 50%, according to analyst Jesse Olson, who points to rising risks that broader financial stress could spill over into cryptocurrencies.
The projection reflects growing concern that a sharp equity sell-off would tighten risk exposure across markets, amplifying downside pressure on digital assets that have increasingly traded in line with high-risk sectors.
Technical model highlights long-term support level
Olson’s outlook is based on a two-week Bitcoin chart using a long-term volume-weighted support line derived from his Market Sniper Pro VWAP model. Anchored to the 2022 bear market low, the model identifies $23,980 as a potential floor under extreme market stress.
A decline of more than 50% in equities would likely trigger widespread deleveraging, with traders pulling capital from speculative assets such as cryptocurrencies.
Broader market warnings add to bearish backdrop
Concerns about equities are not isolated. Economist Gary Shilling has warned a U.S. recession could push stock markets down by as much as 30% by year-end. Meanwhile, GMO co-founder Jeremy Grantham has described the recent artificial intelligence-driven rally as speculative, and Michael Burry has compared current conditions to the late stages of the dot-com bubble.
These perspectives reinforce the view that the broader financial environment remains fragile, raising the risk of further synchronized declines between stocks and Bitcoin.
Correlation with equities increases downside risk
Bitcoin’s trading behavior has closely mirrored that of high-risk assets, particularly during periods of stress when liquidity tends to exit speculative markets. A prolonged equity downturn could therefore accelerate selling pressure in crypto markets.
Major indices such as the S&P 500 and Nasdaq have already shown signs of fatigue following a prolonged rally fueled by AI-related optimism. Elevated market concentration has also drawn comparisons to past bubble cycles, increasing sensitivity to negative shocks.
Weak demand signals persist
Demand indicators suggest limited participation from U.S. traders. The Coinbase Premium Index, which tracks the price difference between Coinbase and other exchanges, has remained negative throughout 2026, with an extended stretch of more than 40 consecutive days below zero. This points to weaker buying interest or active selling from U.S.-based market participants.
Bitcoin ETFs record sustained outflows
Spot Bitcoin ETFs have also reflected cautious positioning. Since May, these products have recorded billions in net outflows, including a reported $6.35 billion over a 30-day period, according to Galaxy Research. Data from SoSoValue similarly shows cumulative outflows of $4.68 billion, highlighting a sustained pullback among larger holders.
Analysts warn of sub-$30,000 scenarios
Other market analysts, including Alex Thorn of Galaxy Digital and independent trader Crypto Kid, have outlined similar downside scenarios. Their projections suggest Bitcoin could fall below $30,000 if equity markets weaken further.
Macro conditions weigh on outlook
Monetary policy remains another constraint. The Federal Reserve has held interest rates steady while signaling that restrictive conditions could persist until inflation is firmly under control. Higher rates tend to reduce appetite for risk assets by making safer instruments like bonds more attractive.
Together, a fragile equity market, weak demand indicators, and tight financial conditions present a challenging environment for Bitcoin in the coming months, with technical models pointing to significantly lower levels if broader markets deteriorate further.
Concerned about Bitcoin’s downside risk? Learn how to use technical analysis to navigate volatile crypto markets more confidently.
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