Bitcoin, S&P 500, Dow and the correlation that everyone was hoping to be absent

by Patrick Gon
Stock Market

If we compare the chart of Bitcoin and the S&P 500 from mid-February it is a mirror chart. A similar trend was characterizing Bitcoin and gold from mid-December until a few weeks ago. 

But now looking at the chart of Bitcoin and the S&P 500 it can be seen how in the last month the two markets are highly correlated. 

It is an indication that does not bode well in the coming weeks but, as Bitcoin has accustomed us also in the past, it is very likely that this correlation will then be missing. 

In such a difficult moment, with the tensions that are found in the financial markets and from a psychological point of view, the expectation of having that is getting closer seems to be overshadowed.

For cryptocurrencies, the work done in the last few months is totally canceled and doubts are starting to arise on the sector in an equally delicate phase of the world stock markets, with the exchanges that today record further lows and sinks. 

On the European markets, the Dax, Eurostoxx and Ftsi Mib indices also show double-digit falls of 10% today. 

The fall in the US stock indices today causes trade to freeze, which will most likely be suspended for an indefinite period tomorrow to face a pandemic crisis that has now also reached the United States.

This will necessitate actions such as those taken in Europe that will block the activities, markets and electronic exchanges of the indices of the US stock markets, such as that of the CME, the CBOE and most likely also the NASDAQ.

The only asset that is proving to be an anti-coronavirus is that of gold which, although in contraction, continues to remain at the highs of recent years, recently updated highs. 

Different behavior was expected of Bitcoin and cryptocurrencies. What is certain is that this movement has definitely canceled all the increases that have accompanied us until a few days ago and for most of the quarter that is now ending in a way that is no longer so exciting. 

It’s not all lost, but we will have to deal with a global market where all the indices are all set to the downside.

You may also like

Leave a Comment