Let us check out the crypto market. From the day’s peak, the price of Bitcoin abruptly dropped four percent. It is because uncertainty in the stock market intensified.
On October 30, the price of BTC (Bitcoin) abruptly dropped four percent from the day’s peak. It is because uncertainty in the stock market intensified. There are five days left to the United States presidential election. Thus, BofA, or Bank of America, suggested a twenty percent drop is possible.
Since October 12, the Dow Jones Industrial Average declined 7.55%. In the same three weeks, Tech-heavy stock indices performed slightly better. Furthermore, the Nasdaq dropped 5.8%.
Meanwhile, in recent weeks, the correlation between stocks and Bitcoin has declined. Thus, the slump of risk-on assets might negatively affect cryptocurrencies.
Michelle Meyer leads the BofA economists. So, he said that elections results are not the biggest threat to equities.
The biggest threat is whether a contested election will occur that might cause the markets to rattle because of the uncertainty. The markets might rally regardless of who wins the election. Nevertheless, a contested election might lead to a market slump.
The economists wrote that markets would welcome the landslide victory for either Biden or Trump and rapid election conclusion. Meanwhile, a severely contested election will see risk-off and drive ten-year rates materially lower.
Still, Bitcoin struggles to gauge whether a potential prolonged equities dump would cause a pullback.
Since October 12, Bitcoin rallied by nearly sixteen percent. Meanwhile, the United States stock market indices decreased by five percent to six percent. In the last eighteen days, Bitcoin increased from $11,167 to $13,290. It massively outperformed the United States dollar, gold, and stocks.
Nevertheless, the confluence of Bitcoin faces a multiyear resistance level at fourteen thousand dollars. Moreover, there is a lack of certainty around risk-on assets. Thus, both factors can slow the momentum of Bitcoin.
Cointelegraph reported that in the near term, thirteen-thousand dollars serve as a large whale cluster. Thus, it means that high-net-worth buyers will most probably protect $13,000 as a critical support area. Since, in mid-2019, fourteen thousand dollars was the before for Bitcoin, the new range will most likely be found between $13,000 and $13,900.
There is a possibility that market uncertainty will remain after the elections. In that case, there will be a higher probability that it will place Bitcoin in the slow region of $13,000 for a prolonged period. It would not be necessarily unhealthy.
Alternative cryptocurrencies, throughout October, have found themselves in an awkward position.
That is the news of the cryptocurrencies.
- Trading Instrument