Bitcoin Is ‘A Great Hedging Tool' Which Remains Unaffected by External Factors

  • The market in consolidation is a “great sign” and the type of price action that tends to lead to a bullish flag
  • Bitcoin remains completely uncorrelated makes Bitcoin “a great hedging tool”

Yesterday, Bitcoin went to $9,575 level only to go down to $9,075 level. In the past 24 hours, Bitcoin has dropped 2.24% but is still maintaining above $9,000, a level the digital asset broke above last week. Mati Greenspan, founder of Quantum Economics in his Tuesday newsletter said,

“As we continue to consolidate, it seems that a touch of gravity has set in. So far the red numbers have been extremely mild, which is a great sign as this is exactly the type of price action that tends to lead to a bullish flag.”

From the technical point of view, he said we would be looking to test the 200 DMA as support which means “a kiss of that blue line without breaking below would likely signal a blast off pattern en route to the moon.”

Analyst The Cryptomist feels the “drop could almost be complete,” as we approach the support test of the wedge in addition to the possibility of a “falling wedge within wedge present.”

A Great Hedging Tool

While Bitcoin has been holding stable, after the US it’s China’s turn now. The US stock market is now recovering from the deep selloff from last week. Meanwhile, the Chinese market opened on a deep red after being closed because of the Spring Festival which was then further extended due to the coronavirus outbreak.

The People’s Bank of China is now doing its best to stymie this selloff and inject billions of dollars in the market to prop up the prices of China’s stocks which are looking “downright ugly.” But for now, it isn’t having much effect on the price.

However, the fact that Bitcoin isn’t affected by whatever is happening in stocks is good for the crypto market. Greenspan said,

“Crypto is neither acting like a safe haven in the face of the virus, nor is it selling off with the other risk assets. Rather, it remains completely uncorrelated.”

And from a portfolio manager’s perspective, “the fact that it is less exposed to whatever's happening in the news and is largely unaffected by external factors,” is what makes Bitcoin “a great hedging tool.”

Get Free Email Updates!

*Action* Enter Best Email to Get Trending Crypto News & Bitcoin Market Updates

I will never give away, trade or sell your email address. You can unsubscribe at any time.

AnTy
AnTy
AnTy has been involved in the crypto space full-time for over two years now. Before her blockchain beginnings, she worked with the NGO, Doctor Without Borders as a fundraiser and since then exploring, reading, and creating for different industry segments.

[Alert] Use the author's self-conducted information at your own risk, do you own research, never invest more than you are willing to lose.

[Disclosure] The published news and content on BitcoinExchangeGuide should never be used or taken as financial investment advice. Understand trading cryptocurrencies is a very high-risk activity which can result in significant losses. Editorial Policy \\ Investment Disclaimer

LEAVE A REPLY

Please enter your comment!
Please enter your name here

3,468FansLike
2,795FollowersFollow
4,233FollowersFollow

Live Bitcoin Price & Latest BTC Charts

Today's Latest Crypto News

Deregulating Bitcoin May Increase Speculative Trading Instead of Technical Innovation: Japan’s New Top Financial Regulator

Ryozo Himino, the new top financial regulator of Japan, wants the country to take caution over promoting digital assets, arguing that instead of promoting...

Goldman Sachs New Digital Asset Manager Reveals Plans to Bring A ‘Digital Token' to the Bank

U.S. financial giant Goldman Sachs is pushing forward its plans to launch a digital asset with the appointment of its new digital asset...

Grayscale Ethereum Trust Files with SEC to Halve the ETHE Locking Period Same as GBTC

Grayscale Investments has publicly filed a registration statement on Form 10 with the US Securities and Exchange Commission (SEC) on behalf of its Ethereum...

Florida Teenager Behind the Infamous Crypto Twitter Hack Pleads Not Guilty to 30 Counts of Fraud

Graham Ivan Clark, the 17-year old Florida teenager accused of being the main culprit of the most significant privacy breach in Twitter’s history, has...

Bitmain’s Management Feud Is Finally Affecting Business Operations; AntMiners Shipments Delayed

Bitmain’s top-level struggles cause a three-month delay in Antminer hardware. Two mutually exclusive solutions offered to customers. The constant wrangling within the largest Bitcoin...

BitcoinExchangeGuide is a hyper-active daily crypto news portal with care in cultivating the cryptocurrency culture with community contributors who help rewrite the bold future of blockchain finance. Subscribe on Google News, see the mission, authors, editorial links policy, investment disclaimer, privacy policy. Got News? Contact us, we are human too. Note: nothing here is financial advice, do your own research thoroughly.

Start Using Crypto Today