S&P 500 Moves Above $3000 Defying Naysayers, Bitcoin and Altcoins to Follow?

By Nivesh Rustgi
May 26, 2020 Updated May 26, 2020
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Image Courtesy of Flickr

The S&P 500 index moves above $3000 in less than three months from the COVID-19 crash in mid-march. With the weak economic projection and fundamental, this might come as a surprise to many. Nevertheless, the price action seems to be dominated by the Fed induced market liquidity. Thomas Lee, partner at Fundstrat tweeted,

– analysts are mostly ‘flying blind’ with their estimates for 2Q.
Hence, we expect 2Q2020 EPS to be WAY BELOW consensus, and probably a loss for 2Q2020. S&P 500 2020 EPS likely $50 per share

The earning per share (EPS) in 2019 was reportedly $139.47. Even with negative projections for the second quarter, the stock markets continue to soar up on the short side liquidity in the markets.

spx 500
S&P 500 Daily Price Chart (TradingView)

Presently, the $3009 level also marks the 200-Day MA (Moving Average), support above the moving averages would be significant for the bulls. The revival of the economy after the lock-down is helping the bulls with stock markets in Asia and oil prices soaring as well.

The correlation between Bitcoin [BTC] and the stock market seems to have weakened since the halving pump around the first week of May. The traders sentiments which turned bullish around halving have now become negative with the drop below $9000. The price of Bitcoin [BTC] at 5: 15 hours UTC on 26th May is $8895.

Greater Risk Patterns

Since the gold prices continue to trade above $1700, the risk-on component in the markets still seems inhibited. Bitcoin, which surged along with the stock markets in March and April stands to gain in the neutral, but uncertain environment. Crypto analyst and trader, Josh Rager tweeted,

$BTC price action a little slow right now – hoping it picks up along with stock market hype tomorrow

Altcoins are still the play right now to stack more sats

btc dominance charts
Bitcoin [BTC] Dominance Chart (TradingView)
A bullish action in Bitcoin stands to amplify the gains in altcoins. The dominance of Bitcoin over the crypto markets is currently at 66.6%. A break below the 200-Day EMA and parallel range support around 66.04% could lead to considerable growth in altcoins vs. BTC pairs.

Do you think that the crypto markets are primed for a bull run? Please share your views with us. 

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
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.

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