Fairlead’s Katie Stockton says equities and Bitcoin still in bull market cycle

Katie Stockton, founder and managing partner of Fairlead Strategies, believes the broader stock market and Bitcoin (BTC) are still in a bull market cycle.

Stockton shared his view on the market in an interview with CNBC’s ‘Squawk Box’ on Monday.

Highlighting the current market outlook compared to three weeks ago, he said:

“We had a bit of a setback, but that has sort of resolved to the upside for S&P. You know, it’s not fully resolved yet. [but] We’re almost close to that. “Where this happens is actually a strong open above 5440, so we’re using that as a stop loss on the upside.”

Volatility has been extremely low in recent weeks, leading some analysts to warn that pullbacks could be “the calm before the storm.”

But the Fairlead Strategies founder says support remains intact and the market could be looking at a breakout to the upside as the low volatility cycle dissipates.

Bitcoin and Nasdaq 100

Katie Stockton also commented on Bitcoin, noting that the Federal Reserve’s decision to keep interest rates steady and only signaling the potential for a single cut in 2024 could cause Bitcoin to struggle.

“We are watching Bitcoin because the correlation with the Nasdaq 100 is rising to levels we haven’t seen since 2021. To me this is interesting. “This shows that investors are now broadly approaching everything, including Bitcoin and stocks, as a risk asset,” he added.

While the Bitcoin price has struggled since reaching $73,000 in March, the Nasdaq 100 index has also been on the rise since mid-April.

However, despite Bitcoin’s lack of upside momentum and divergence with the Nasdaq 100, Fairlead Strategies says both BTC and the stock market could move higher.

“We still believe in this bull market cycle for Bitcoin and stocks. “But when people say ‘wait a second, Nvidia might be a little overstretched here,’ we feel like that divergence will probably catch up to the Nasdaq 100 Index.”

On Monday, Bitcoin changed hands around $65,200 at 12:25 ET.