Bitcoin Rises in Line With Stocks After Dip Below $9K
Bitcoin’s positive correlation with stocks continues Monday, with the cryptocurrency drawing bids alongside gains in global equities.
As of 09:35 UTC, the leading cryptocurrency by market value is trading at $9,190, representing a 1.4% gain on a 24-hour basis, according to CoinDesk’s Bitcoin Price Index.
Meanwhile, major European equity indices are up at least 1.5% each, following a 4% rise in mainland Chinese stocks seen during the Asian trading hours.Futures tied to the S&P 500 are also up over 1%, according to data source Investing.com.
Equities are flashing green despite a worrying increase in coronavirus cases in the U.S.and other parts of the world.According to CNBC, investors are cheering the progress of potential coronavirus drugs.On Friday, the European Commission moved to grant conditional approval for U.S.-based Gilead’s antiviral drug remedesivir to be used in the European Union.Equities save the day
Bitcoin fell below the psychological support of $9,000 on Sunday, validating bearish lower highs at $10,000 and $9,800 created on June 10 and June 23, respectively.
In addition, momentum indicators like on-balance volume (OBV) were signaling weakness, as noted by popular trader NebraskanGooner Sunday.
As such, the cryptocurrency looked set for a deeper loss.
However, selling pressure ran out of steam near $8,900 around 06:15 a.m.Tokyo time, as U.S.
stock futures rose and bitcoin prices charted a quick move back above $9,000.The cryptocurrency would have faced stronger chart-driven selling had prices established a foothold below that psychological support.
So, the uptick in stocks looks to have saved the day for the bitcoin bulls.The cryptocurrency’s positive correlation with stocks reached record highs last week.Problem ahead?
Bitcoin’s positive correlation with stocks makes it vulnerable to bouts of risk aversion in traditional markets.
The equity markets could soon come under pressure, dragging bitcoin lower, if the U.S.Federal Reserve fails to appease equity markets with additional stimulus.
According to analysts at JPMorgan, the U.S.money markets are signaling the need for further monetary and/or fiscal policy.
“If the additional stimulus is not delivered, then the money market curve inversion could worsen, eventually becoming a more problematic signal for equity and risky markets going forward,” said the bank’s analysts.
The Fed seldom disappoints markets.
The central bank has already expanded its balance sheet by over $3 trillion in the past 3.5 months and will likely add more, if deemed necessary.BTC awaits directional move
Bitcoin has witnessed minimal movement over the past nine days, with upside capped around $9,300 and downside restricted near $8,830.
Notably, the trading range narrowed to $395 last week.
That’s the smallest weekly trading range since the last week of March 2019.
A prolonged period of consolidation often ends with a big move to either side.For instance, the cryptocurrency jumped 26% in the first week of April 2019, having witnessed low-volatility consolidation in the preceding five weeks.
Disclosure: The author holds no crypto assets currently.
Disclosure
The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies.CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.
Share this: Can Open Source Networks Address Medical Shortages? Feat.Bruce Fenton Mar 18, 2020 at 19:00 UTCCan Open Source Networks Address Medical Shortages? Feat.Bruce FentonIn this episode of The Breakdown, NLW talks open source ventilators, overreactions in monetary policy and the slippery, sticky slope towards helicopter money with Bruce Fenton.For more episodes and free early access before our regular 3 p.m.Eastern time releases, subscribe… XRP Price Bucks Bearish Market Mood to Hit 13-Day High XRP is reporting double-digit gains today, despite a generally bearish mood across the wider crypto markets.The open-source token – which is developed largely by blockchain payments startup Ripple – was changing hands at $0.3251 at press time, having hit a 13-day high of $0.3241 at 14:00 UTC.The world’s third-largest cryptocurrency by market capitalization has… CME Says It Will Launch Bitcoin Options in January news Derivatives exchange CME Group has announced it will launch options on its bitcoin futures contracts in January.In a notice on its website on Tuesday, the Chicago-based exchange said, as long as it gets the green light from regulators, the options will go live on Jan.
13, 2020.In late October, the firm published… Crypto Firm CEO Went Into Hiding After Claims 2,000 Investors Defrauded Guateng High Court, Pretoria, South Africa (VladanRadulovicjhb/Shutterstock)Willie Breedt, CEO of cryptocurrency investment firm VaultAge Solutions, has been officially declared bankrupt while on the run from angry investors.As reported by News24 on Monday, Breedt – who is suspected of defrauding over 2,000 investors – was handed a sequestration order by the Gauteng High Court in… Dutch Central Bank Wants to Be European Union’s CBDC Proving Ground Apr 21, 2020 at 19:16 UTCUpdated Apr 21, 2020 at 19:23 UTCThe Dutch Central Bank cited its nation’s declining use of physical cash as one of the reasons it may do well with a CBDC trial.(Credit: Shutterstock)Dutch Central Bank Wants to Be European Union’s CBDC Proving GroundThe Dutch Central Bank (DNB) thinks the Eurosystem’s… Hacker Returns Ethereum Domains Lost in Bug Exploit news The domain names stolen from the Ethereum Name Service’s (ENS) auction have been returned.As CoinDesk reported at the time, the ENS bidding process managed by digital-collectibles marketplace OpenSea was exploited, allowing a hacker to nab 17 domain names for lower bids than other users placed.ENS and OpenSea asked the hacker to return… Steemit to Automate Development Funding With New DAO news Steemit, a blockchain project that focuses on monetizing social media sites, has given details of a coming code upgrade that will usher in big economic changes.Announced on Wednesday, the steem blockchain will undergo its 21st hard fork on Aug.
27 – one that will build in a new Worker Proposal System aimed to allow the… ‘Satoshi Was a Black Woman’: Blockchain Entrepreneurs Talk Financial Inclusion on Juneteenth Jun 19, 2020 at 22:28 UTCUpdated Jun 19, 2020 at 22:38 UTCJuneteenth Flag (Nafsadh/Wikimedia Commons)‘Satoshi Was a Black Woman’: Blockchain Entrepreneurs Talk Financial Inclusion on JuneteenthRacial diversity and financial inclusion are good for cryptocurrency and blockchain – and the industry has work to do.That was the overarching conclusion of a virtual Juneteenth event put together… Venezuela Is a Testing Ground for Digital Dollarization (and Zelle Doesn’t Like It) Jun 16, 2020 at 16:47 UTCUpdated Jun 16, 2020 at 16:48 UTC(Rustamxakim/Shutterstock)Venezuela Is a Testing Ground for Digital Dollarization (and Zelle Doesn’t Like It)J.P.Koning, a CoinDesk columnist, worked as an equity researcher at a Canadian brokerage firm and a financial writer at a large Canadian bank.He runs the popular Moneyness blog.Dollarization isn’t what it… Leave a Reply You must be logged in to post a comment.Search.