Bitcoin (BTC) Now Transitioned to Trade More like a Commodity amidst Global Market Rout, says Analyst

Must Read

Eight Things in Crypto You Can’t Afford to Miss This Week

In this roundup, we cover China's market-rattling resistance to Bitcoin, the increasing drumbeat toward crypto regulation, the...

Why the Cloud Industry Needs to Become Greener

According to Energy Post, the Internet will consume 20% of the projected electricity demand...

Your Wallet May Not Be as Secure as You Think; Here’s What To Do

Remember the egregious breach that exposed Ledger’s entire trove of customer data to the public?...
- Advertisement -
Earn Free Bitcoin

Today, the Bitcoin price dropped another 25% to $4,435 from nearly $6,000, we hit yesterday. However, the digital asset is back above $5,000 with the trading volume reading a whopping $2.7 billion on top ten exchanges with real volume.

Altcoins followed Bitcoin and fell hard and are still in the red, recovering $12 billion after wiping out $30 billion from the entire market capitalization earlier in the day.

Fed Cuts Rate to Zero and Restarts QE

The price of Bitcoin rose yesterday on the back of the Federal Reserve slashing the interest rates to zero and launching a $700 billion QE program.

Bitcoin was front-running the news on the weekend as unlike the traditional markets, the crypto market is never closed down.

“We do know that the virus will run its course and that the U.S. economy will resume a normal level of activity. In the meantime, the Fed will continue to use our tools to support the flow of credit,” said Fed Chairman Jerome Powell.

President Trump, who has been criticizing the Fed for not cutting rates faster and further as recently as Saturday, showed support for their latest move on Sunday.

“It makes me very happy and I want to congratulate the Federal Reserve. That’s a big step and I’m very happy they did it,” said Trump.

Dash for Cash

Despite the Fed’s emergency rate cut and QE, markets are in for another rollercoaster week. The S&P 500 opened on Monday by dumping over 8% and immediately tripping a trading halt. However, even after the circuit break, the blue-chip index, Nasdaq and Dow each were sharply lower.

The Fed is deepening the monetary policy response to the coronavirus (Covid-19) outbreak which has sickened over 3,200 people in the US as of Sunday. Just last week, the Fed boosted its liquidity injections in repo operations aggressively, by more than $1.4 trillion.

This has not only stocks but also the traditional safe haven asset gold hitting a low of $1,456.8, its lowest level since Nov. 27. The precious metal also traded below its 200-day moving average for the first time since Dec. 20, 2018.

Typically, the bullion performs well during market sell-off owing to its role as a safe haven but couldn’t escape the global stock market plunge since last week.

“We are in a scenario where investors are selling whatever they can and this has also affected gold, probably more than it should be,” said Carlo Alberto De Casa, chief analyst at ActivTrades.

Bitcoin still “highly dump susceptible”

Meanwhile, the crypto market is holding up quite well. While the stock market continues to plummet, Bitcoin is hovering around $5k with a strong volume.

“Due to the circuit breakers and loss limits in the stock market, we really can’t compare crypto to it anymore. Instead, bitcoin has transitioned to trading more like a commodity during these troubling times,” said Mati Greenspan, founder of Quantum Economics in his Monday newsletter.

Bitcoin isn’t’ getting the worst of depreciation as silver was down 20% at one point today.

“Truth is, everything is kind of falling together, just the stock markets have the added benefit of ample downtimes.”

However, below $5,200, the Bitcoin price is “highly dump susceptible,” according to trader Mr. Anderson. To “feel relatively safe,” the crypto asset needs to go back above $6,250.

- Advertisement -
- Advertisement -

Latest News

Sunday Market Analysis from Trendtracers

BTCUSDT. First impression is bearish, there seems to be yearly support at around 28k, We’re expecting more...
- Advertisement -Earn Free Bitcoin

Earn Passive Income with Nhash Cloud Mining Services

Cloud mining services are an easy way to earn passive income online. Although...

Afri-X and DigiShares Bring Tokenization to Africa

DigiShares is proud to announce its partnership withAfri-x.com to deliver the power of tokenization to Africa. DigiShares has licensed its tokenization platform to...

Racing For Heroes selects Gen2 Technologies as a Key Technology Partner

SPARKS, Nev., April 7, 2021 /PRNewswire/ -- Gen2 Technologies Inc. (the "Company") (OTC: MNIZ) is proud to announce that it has been...

Ken The Crypto tells You How to Get the Most out of the 2021 Bull Run

The year 2021 is what people call the "Bitcoin Year", and the reason is self-explanatory. This recent bull-run has brought...