If you want to know where Bitcoin's heading next, you should watch the stock market. Bitcoin and the S&P 500 have been moving together since the crash began in late February. The correlation is not perfect, but it's pretty strong, and it still shows no sign of going away. Today, both markets have been falling heavily, moving in lockstep once again.
If you believe we're heading into another stock market collapse, then that's probably where Bitcoin's heading too. If you think stocks will recover strongly, then Bitcoin is likely to benefit.
The really exciting moment would be a break in this correlation, as stocks start to head one way and Bitcoin the other. That would strongly suggest a major new headwind for Bitcoin (not necessarily an upward one though!) as it would show Bitcoin traders forming a strong collective conviction for whichever direction they ultimately choose.
If you believe we're heading into another stock market collapse, then that's probably where Bitcoin's heading too. If you think stocks will recover strongly, then Bitcoin is likely to benefit.
The really exciting moment would be a break in this correlation, as stocks start to head one way and Bitcoin the other. That would strongly suggest a major new headwind for Bitcoin (not necessarily an upward one though!) as it would show Bitcoin traders forming a strong collective conviction for whichever direction they ultimately choose.
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The correlation between stocks and bitcoin is stronger than ever right now. This is yesterday's price correction & partial recovery. Remarkable similarity between the two.
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A new week, and the correlation is still holding tight, even on a 15-minute chart.
THE CRYPTO TRADER: How anyone can make money trading Bitcoin and other cryptocurrencies
Published by Harriman House.
This link should take you to your local Amazon site.
getbook.at/TheCryptoTrader
Published by Harriman House.
This link should take you to your local Amazon site.
getbook.at/TheCryptoTrader