More

    Bitcoin Jumps on the News of The Fed Launching “Unlimited QE”

    Meanwhile, US Stocks Wipe Out All of the Gains Since Donald J Trump Became President.

    Just like last weekend when the price of bitcoin reacted immediately to the US Federal Reserve slashing interest rates to zero and restarted the QE program, today bitcoin jumped on the back of unlimited QE news.

    Bitcoin was trading under $6,000 only to jump to $6,629 in under an hour. However, we are back around $6,300, up 5.83% in the past 24 hours.

    Despite the stimulus, the stock market opened lower with the Dow Jones Industrial Average slipping 1.8% and S&P 500 fell 2.9%. Gold, however, headed higher on Monday to $1,524.96 an ounce after the Fed unveiled an aggressive round of additional stimulus.

    “US stocks gave back all gains since the start of Trump's presidency,” noted economist and trader Alex Kruger.

    No Limit

    The Fed said on Monday that it will launch several programs to help markets function more efficiently amidst the coronavirus crisis.

    “The coronavirus pandemic is causing tremendous hardship across the United States and around the world. Our nation’s first priority is to care for those afflicted and to limit the further spread of the virus,”

    the Fed said in a statement.

    “While great uncertainty remains, it has become clear that our economy will face severe disruptions. Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift recovery once the disruptions abate.”

    Fed President James Bullard predicted the US unemployment may hit 30% in the second quarter and an unprecedented 50% drop in GDP because of the shutdown to combat the coronavirus (Covid-19).

    Among the initiatives is a commitment to continue its asset purchasing program, a new chapter in Fed’s “money printing.” Other initiatives include unspecified lending programs to support eligible small-and-medium sized businesses.

    “We are now in QE infinity, again,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group.

    Free Money, Not Free Lunch

    The Fed has been injecting billions of dollars in the economy and considerings trillions more as the coronavirus cases around the world surge over 353,000 and at least 470 people die in the US.

    With the shorter-term MMT announced, “the government can now spend all it wants,” said Kruger. This the economist said is “how free money looks like. But there is no such a thing as a free lunch.”

    “Society pays for this. Via inflation. The price to pay is inflation in the long run. Inflation expectations are popping and the long end of the treasuries curve is already pricing it in,” said Kruger.

    And this is why the crypto industry is so excited. Already, Bitcoin is looking like it might be decoupling, and according to on-chain analyst Willy Woo, we would get more confirmation of this in the coming weeks.

    He explains that in a flight to safety, traders first exit risk-on leveraged positions to pile into USD, which has been soaring all this time. Once the assets have crashed against USD and fear peaks, comes the time to hedge in assets ahead of rise in their value as it happened in 2008 in gold and Woo says would happen to BTC in 2020.

    It’s the first time that Bitcoin is going through a crisis and there is no knowing how it will perform. Currently, it is acting like a risky asset with charts having a bear flag, however, the fundamentals are strong and bullish while the stock-to-flow model cointegration is being followed nicely.

    “Investors and consumers have trouble understanding Bitcoin’s value proposition. The former expects a cash flow, the latter expects magical payments UX. Both are disappointed by Bitcoin. Savers quickly fall head over heels in love with Bitcoin,”

    said co-founder of the Satoshi Nakamoto Institute, Pierre Rochard.

    Bitcoin (BTC) Live Price

    1 BTC/USD =$6,641.4374 change ~ 5.43%

    Coin Market Cap

    $121.54 Billion

    24 Hour Volume

    $8.53 Billion

    24 Hour VWAP

    $6.35 K

    24 Hour Change

    $360.4183

    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 a year now. Before his blockchain beginnings, he 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

    3,354FansLike
    2,774FollowersFollow
    4,134FollowersFollow

    Live Bitcoin Price & Latest BTC Charts

    Today's Latest Crypto News

    Crypto Exchange Binance Looks To Join Houbi, OKEx In Launching A Mining Pool

    Top crypto exchange Binance has plans to launch its own mining pool, according to a Russian crypto news outlet Coinlife on Tuesday. The news was...

    Coinbase Custody Moves Tezos (XTZ) Staking Bakery From US to Ireland For Regulatory Reasons

    Coinbase has managed to move the Tezos Staking Bakery, the largest validator since its launch in 2019 which the exchange has been operating since...

    BitMEX’s Operator HDR Global Grants $100k Towards Bitcoin Core Development

    BitMEX’s parent company HDR Global Trading Limited has awarded $100k to the Bitcoin core developer Michael Ford. This will be the second grant towards...

    Bitcoin, Ethereum, DogeCoin, Lightning Network's Code to be Buried Under Arctic Ice

    The Bitcoin codebase snapshot will be encoded onto film and afterwards be stored for 1,000 years under ice, in Svalbard, Norway. The move is included...

    Huobi Wallet to Integrate Crypto Lender Cred Allowing Users To Earn Interest

    The crypto exchange offering wallet services Huobi has closed a partnership with the decentralized crypto lending company Cred in order to offer user's interest...

    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.