Eric Balchunas Calls Nvidia-Driven Market Sell-Off The '280th Nervous Breakdown,' Sees Bitcoin Base In The $60K

Detailed summary

Eric Balchunas cited ETFs as a barometer, noting that the SPDR Gold Shares fund took roughly eight years to recover from its early peak and then more than doubled.

Bloomberg ETF analyst Eric Balchunas called the latest market sell-off "the 280th nervous breakdown that the markets have had in the past couple of years," on Friday, while saying Bitcoin (BTC) appeared to have found "a nice base somewhere in the 60s."

Speaking with Scott Melker on The Wolf Of All Streets podcast, Balchunas said sell-offs like the recent drop in Nvidia (NVDA) tended to be "algo-driven, headline-driven," and possibly, "short-lived." He said he was "unfazed" and called the hit to the AI trade "more like a speed bump," unless earnings were running into "a real problem over the next couple quarters."

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Balchunas said investors in stock exchange-traded funds (ETFs) kept buying through the drop. "The Vanguard people, they buy it always," he said. "You cannot shake them." Bitcoin ETFs have not followed the same pattern.

Balchunas estimated year-to-date outflows into the funds at about $1.4 billion. "I mean, it's almost flat. Considering the downturn and the negativity, that's pretty good," he said. "You're treading water in a year."

According to SosoValue data, U.S. Bitcoin ETFs stood at $1.75 billion in net outflows so far this year.

According to Balchunas, Bitcoin was harder to hold through a downturn because it had no cash flows. However, it was "sentiment-driven," but he added that "with all the bad news thrown at it, it seems to have this nice base somewhere in the 60s."

He described Bitcoin's pattern as the reverse of stocks. "It takes the elevator up and the stairs down," Balchunas said, while stocks take "the stairs up and the elevator down."

Bitcoin's price was trading at $68,000, down nearly 3% over the past 24 hours. On Stocktwits, the retail sentiment around BTC remained in the 'extremely bearish' zone, while chatter around it stayed at 'high' levels over the past day.

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