Bottom Found? Wall Street And Cryptocurrencies Are Soaring In Green
Markets across the board are marking tremendous increases since the beginning of the week. The largest indexes are charting notable gains despite the continuously spreading coronavirus as well as other concerns such as the escalating number of job loss claims in the US.
The cryptocurrency market follows as absolutely every coin in the top 20 is trading in the green today. Some are even up double-digits.
Wall Street Rejoice
This week has been very impressive for Wall Street, to say the least. At the time of this writing, it appears that every sector is recovering as the market sees a sea of green.
The major indices are, of course, up in yesterday’s trading session. The S&P 500 is about 7%, the Dow Jones Industrial Average gained 1,627 points yesterday and is up 7.73%.
The FTSE 100 is currently up 2.93% in today’s trading session, having opened well beyond yesterday’s close.
The futures are also looking promising, hinting at yet another positive daily open. The S&P 500 futures are up well over 3% on the day, while the DJI futures are up another 815 points or 3.6%.
Cryptocurrency Market Follows
Wall Street traders won’t be lonely in their short-term celebrations as the cryptocurrency market is also up a ton. It gained more than $9 billion collectively in the past 24 hours alone, once again breaking above the $200 billion mark.
Bitcoin continues to make strides as it’s currently trading around $7370. Among the most significant gainers in today’s trading session include Ethereum (16.6%), Chainlink (18%), and Tezos (18%).
A Well-Defined Correlation
As Cryptopotato recently reported, the coronavirus-induced financial crisis brought up an interesting correlation between gold and Bitcoin. Evidently, the two assets have been increasingly correlated throughout the short-term while keeping a rather low correlation over more extended periods of time.
Comparing their price with that of the S&P 500, however, reveals an even more exciting find.
As seen in the above chart, the prices of gold, Bitcoin, and the S&P 500 index are highly correlated since the beginning of the month.
With this said, it remains interesting to see whether or not Bitcoin will keep its correlation with legacy markets, or it would decouple.
As the markets continue to increase, one of the more frequently asked questions is whether or not they’ve bottomed.
When it comes to the legacy markets, determining whether or not the bottom is in at the time of this writing is perhaps somewhat impossible. Macroeconomic factors such as the lockdown of many countries because of the spreading COVID-19 coronavirus, the rapidly increasing number of job loss claims, the stimulus packages that countries approve to bail out corporations, amid many others, come into play here. Currently, it appears that the emergency economic measures are playing their part, keeping companies afloat, but the question remains for how long this would continue.
On the other hand, the cryptocurrency market has increased substantially since the catastrophic decline on March 12th-13th. Some assets have even doubled-up in value. This, combined with the fact that one of the historically bullish events, the Bitcoin halving, is right around the corner, cause many experts in the field to lean towards the idea that the bottom is, indeed, in.
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