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During the previous trading week, there was a decline in stocks and stock indexes such as the S&P 500 following higher-than-expected inflation data. This development implied a potential delay in Federal Reserve rate cuts until later in 2024. The leading cryptocurrency, Bitcoin (BTC/USD), also experienced a downturn due to these market conditions.

Given the market dynamics, the question arises: between the broad market index and the premier cryptocurrency, which asset presents a more favorable opportunity to “buy the dip”?

Investing in Bitcoin and the S&P 500: “Buying the dip” entails acquiring assets when their prices have recently dropped. This strategy often serves as an opportunity to invest in assets expected to perform well over the long term. A recent poll by Benzinga sought to determine the preferred buying opportunity among its users.

The poll results were as follows:

• S&P 500 Index: 54%
• Bitcoin: 46%

The S&P 500 Index narrowly surpassed Bitcoin in the poll, indicating that a larger proportion of investors polled perceive a more attractive short-term buying opportunity in the leading U.S. stock index.

Significance of the Comparison: The S&P 500, monitored through the S&P 500 ETF Trust (SPY), has achieved numerous record highs in 2024. The tracking ETF has recorded a 25.6% increase over the past year and a 7.8% rise year-to-date in 2024.

Factors such as heightened inflation, postponed rate cuts, and escalating global conflicts may constrain short-term gains for the overall stock market and the S&P 500 as investors evaluate the implications for the upcoming year. The recent series of record highs in the stock market could potentially subside amid these macroeconomic factors and escalating international tensions.

Bitcoin has experienced a 113% surge over the past year and a 46% increase year-to-date in 2024. The optimism surrounding Bitcoin in 2024 stems from the approval of Bitcoin ETFs and anticipation surrounding the upcoming Bitcoin halving event. Historically, Bitcoin halving events, occurring approximately every four years, have resulted in heightened cryptocurrency prices.

As a perceived safe haven asset, Bitcoin tends to attract investors during periods of stock market uncertainty, positioning it as a pivotal asset to monitor in the following weeks.

This study was conducted by Benzinga from April 12, 2024, to April 15, 2024, encompassing responses from a diverse adult population aged 18 or above. Participation in the survey was entirely voluntary, with no incentives provided to respondents. The survey findings are based on 322 adult responses.

For more insights, read: “Investment Expert Predicts 13% Downside In S&P 500 By Year-End With 4,500 Target: ‘We Don’t See The Justification For Higher Multiples’”

Image generated using artificial intelligence via Midjourney.

Market News and Data provided by Benzinga APIs

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