Follow Coronavirus and S&P 500 to Understand Bitcoin and Crypto Markets: Analyst

By Nivesh Rustgi
Published March 14, 2020 Updated March 14, 2020
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Follow Coronavirus and S&P 500 to Understand Bitcoin and Crypto Markets: Analyst

By Nivesh Rustgi
Published March 14, 2020 Updated March 14, 2020
  • Trump declares “national emergency in the US”, unleashing $50 billion of Fed’s fund to tackle the virus
  • Stock markets bounced from lows yesterday, after the activation of emergency protocol is expected to bring positive results.
  • Bitcoin and crypto markets is also showing potentials of bulls with a huge bounce as well, but the fear from Coronavirus continues to loom.

As of now, there are 2,028 confirmed cases reported in the US with 48 deaths. Moreover, Europe has become the epicenter of the virus, declares WHO (World Health organization). The number of reported cases in Spain and Italy have risen past 10,000. Trump notes,

It could get worse. The next eight weeks are critical. Some of the doctors say it will wash through, it will flow through. Interesting terms.

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The short-term bears seem to have exhausted themselves towards the end of the week.  S&P 500 index bounced 9.3% on a Friday gaining 232 points from the recent bottom.

The downturn in the stock markets and crypto-markets began with Trumps’ announcement on Wednesday declaring a ‘pandemic.’ Currently, Bitcoin is trading in line with the stocks, in terms of being a risk asset.

spx tradingview
S&P 500 Index (TradingView)

Alex Kruger, a prominent economist and crypto analyst notes,

To understand what is going on with crypto prices, need to understand the virus and related events. Can use the price of the S&P 500 as proxy for risk sentiment. $BTC is for moments trading tick for tick with stocks.

btcusd daily chart
BTC/USD 1-Day Chart on Bitstamp (TradingView)

Bitcoin along with the crypto markets revives with much vigor from the bottom yesterday around $3,850. The price of Bitcoin [BTC] at 3: 30 hours UTC on 14th January is $5600, nearly 46% higher from lows. Nonetheless, 34% down from the 200-Day Moving Average above $8500.

As far as the virus in concerned, on how the emergency protocols across the world take effect and time it takes in bringing relief will be instrumental for asset prices. Josh Rager, a derivatives and crypto traders notes,

The President basically made a speech to pump stocks 7% the last hour

Not bullish on crypto markets yet, a long ways to go to be certain COVID19 is contained around the world Prediction is continued ranging $BTC for the time being ( short term neutral)

The US Feds will meet next week where they decide on the new floating interest rates, which is likely to be reduces by another 100 bps. Moreover, a move of S&P 500 index to lows around $2300 could affirmatively throw the ecnonomy into a recession.

Do you think the social measures will be able to revive the world from the pandemic? Please share your views with us. 

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Disclaimer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
Nivesh Rustgi
1181 Articles
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

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