Will USD Devaluation Hedge the $SPX Fueled Drop in Bitcoin Prices?
New highs in SPX seems to be acting as a catalyst for the drop in Bitcoin and gold. However, the devaluation of the US Dollar might build bullish fundamentals.
The stock market opening on Tuesday was quite eventful as asset prices across commodity, currency and crypto markets moved drastically.
$SPX new ATH.
Let that sink in.
— Cantering Clark (@CanteringClark) August 18, 2020
The new ATH in $SPX midst the COVID-19 economic slow-down is surprising in itself. But that discussion needs to visit the economic scenario of the world with the rising debt and unemployment countering a high volume of quantitative easy providing liquidity during the apparent recovery from the collapse.
A confirmed break above ATH in SPX will open room for price discovery and a new bullish phase altogether. The time for Bitcoin investors to regret breaking correlation with the stock markets might be approaching fast. Gold records a slight pullback to $1975 per oz. at the opening of the stock market on Tuesday in the US. However, seems to be recovering fast above the $2000 per/ounce level.
US Dollar Devaluation: USD Now At Lowest In 2 years
On the other hand, while SPX index is making new highs, the US Dollar index is breaking below its support, which is a positive fundamental signal for the rise in Gold and Bitcoin. Mati Greenspan, crypto analyst and founder of Quantum Economics tweeted,
US Dollar just broke support. It’s now at the lowest levels in 2 years.
On the technical front, Bitcoin [BTC] has dropped below $11,900 and bulls will be looking to support the range above $11,500-$11,650.
However, there is considerable volatility in all assets at the moment. Josh Rager, a crypto trader and market analyst noted,
There will be many dips on the way to the top Zoom out, see the big picture and remain steadfast
Do you think gold and Bitcoin will hold above support or bulls will give in for the stock market gains? Please share your views with us.
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Disclaimer
The views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views, opinions, positions or strategies of CoinGape. Do your market research before investing in cryptocurrencies. The author or publication does not hold any responsibility for your personal financial loss.
Nivesh from Engineering Background is a full-time Crypto Analyst at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)coingape.com
Published at Wed, 19 Aug 2020 13:42:30 +0000
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