BTC Remains Unaffected With Stock Market Plunge, Out of Control Gold; But It’s a Good Thing

  • A flight to safe-haven assets has gold soaring to fresh 7-year highs
  • Investor fleeing riskier assets with Dow down 800 points
  • Bitcoin remaining uncorrelated is good because “it’s amazing for risk management across your profile,” also “idiosyncratic risk is a major plus”

Renewed fears that the coronavirus will negatively affect the global growth has Gold going out of control. The bullion soared toward $1,700 an ounce amidst a flight to haven assets.

“Commodities are witnessing another risk-off day as coronavirus concerns boil up,” said Norbert Ruecker, head of economics at Julius Baer Group Ltd adding, “the flight to safety pushes gold to new highs.”

Investors are fleeing riskier assets and searching for safety which has the yellow metal climbing to fresh seven-year highs, with bonds also rising. In 2020, the precious metal price has risen over 10% over the concerns about the virus and as speculation mounts that the US Federal Reserve will ease the monetary policy.

“The only real explanation for this is that people are fearful from central bank actions and are looking for a way to hedge their portfolio,” said Mati Greenspan, the founder of Quantum Economics.

And “upward momentum is strong and interest in gold is set to remain high until the situation abates,” said Howie Lee, an economist at Oversea-Chinese Banking Corp.

Uncertainty to keep investors nervous

Markets worldwide meanwhile are getting rocked as the human toll from the coronavirus (covid-19) keeps on growing and economically expanding as well. China recorded the total number of affected at over 77,000 and more than 2,350 dead. The virus is now spreading in South Korea with Italy quarantined some towns as well.

Also,

The market is uncertain with the Dow Jones Industrial Average opening down 800 points on Monday. The S&P 500 and Nasdaq futures are also down 2.7% and 2.9% respectively.

“The uncertainty around how cases outside of China evolve is likely to keep market participants nervous, and therefore markets are likely to remain volatile,” ING Bank commodity strategist Warren Patterson said.

However, a big market sell-off today, Bespoke Investment Group thinks could mean a rebound on Tuesday.

Bitcoin unaffected is “amazing for risk management”

Amidst this, Bitcoin remains unaffected and doing whatever it seems best. The world's leading cryptocurrency had a volatile week and is currently trading at $9,745 down 1.41% in the past 24 hours while volume takes a fall below $1 billion to $800 million on top ten exchanges with real volume.

“Stock futures pummeled. Gold flying higher. Volatile week ahead. Bitcoin got bid right before the open. Remember though BTC-risk correlations are not reliable,” said economist and trader Alex Kruger.

Trader Scott Melker also notes that Bitcoin is not reacting to the coronavirus and the ongoing market shakeup.

“Gold is ripping, equities are dumping. The bitcoin market never closes – it should have reacted already if it was a flight to safety.”

People's knee jerk reaction to global uncertainty being rushing into gold instead of bitcoin is “still a massive benefit,” said Melker.

Bitcoin remaining uncorrelated is good for the flagship because “it’s amazing for risk management across your profile. Idiosyncratic risk is a major plus,” he adds.

Bitcoin (BTC) Live Price

1 BTC/USD =$9,226.3184 change ~ -0.83%

Coin Market Cap

$170.07 Billion

24 Hour Volume

$3.85 Billion

24 Hour VWAP

$9.23 K

24 Hour Change

$-76.2635

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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

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