Bitcoin Rise Due to Lower US Dollar? - page 4.

YOSHIE

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Quote from: Agios on August 14, 2020, 07:33:57 PM

slow economic growth and expanding central bank balance sheets have the potential to weaken the dollar and investors seek safe areas in assets like gold and Bitcoin.

Maybe, could be the main reason ...!

However, we know that the economy is very closely related to the dollar, so far almost the entire world economy has deteriorated, but Bitcoin still has a positive impact, that's what makes many investors turn to Bitcoin at this time, so it's only natural that the Bitcoin price soared.

For other reasons, it can be said is, the increasing number of crypto users and miners today, with reason, it means that the interest of Bitcoin buyers is swelling, Of course, with a limited capacity of only 21 million, maximum, this can also spur current price movements.

lumeire

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Quote from: tabas on August 16, 2020, 04:45:22 AM

Without the COVID-19 a few years ago, bitcoin was strong and US dollar was strong during that time. But it sums up to the speculation of most market watchers.
And don't you ignore that it's not all about US dollars weakening why bitcoin is rising this time.

I guess maybe the rise in bitcoin price is because of the Korean government removing the ban on people which was restricting them to deposit their korean money from the banks to bitcoin trading sites and exchanges. Although a lot of Korean people didn't know about the removal of this ban but maybe they are now becoming aware of it as the time passes by. Also the price increase can be dueled by various other factors like the unrest which is currently in America, inflation all around the globe which is causing the dollar value to fall so technically the bitcoin value should rise against a falling USD, the fed printing a lot of money for stimulus package and many other reasons can be included in the list as well

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Quote from: Agios on August 14, 2020, 07:33:57 PM

In recent weeks, the price of Bitcoin appears to have been driven by one main factor, namely the weakening of the US dollar. This correlation is evident when comparing the US dollar index against Bitcoin.

Correlation is not causation.

We can look at this from another perspective. Pull up a chart of the NASDAQ index, XAUUSD (gold), and BTC. They are all strongly correlated since March, all in strong bull trends, and have broken above their yearly highs. In fact this correlation goes far beyond these three assets; risk assets are in bull markets almost across the board. And there is a good explanation for that: $6 trillion pumped into the economy through Fed QE and stimulus.

The DXY does historically have some negative correlation with stocks and gold. However, I think the current DXY weakness is rather due to the magnitude of the US's economic contraction and its poor response to COVID-19 pandemic, relative to other currencies in the basket. I don't think this has much effect (if any) on BTC.

justdimin

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I feel like dollar losing value played a big role but halving played another role in this increase as well which people forget nowadays. Just in may we have basically dropped almost a million dollars per day money right there on the table after the halving, you have to realize that this should have an effect on bitcoin as well. Obviously it can't have daily affect because daily changes are bigger than a million dollars a day, but lack of it totally combined after certain period of time does have an effect.

Obviously I am not saying that is the only thing, obviously printing of dollar in trillions has a much bigger impact on bitcoin however that doesn't mean that bitcoin could be increasing due to just one thing and one thing alone, it does change because of some other stuff as well, mainly halving for example.

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Without the COVID-19 a few years ago, bitcoin was strong and US dollar was strong during that time. But it sums up to the speculation of most market watchers.
And don't you ignore that it's not all about US dollars weakening why bitcoin is rising this time.

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Quote from: davis196 on August 15, 2020, 07:08:18 AM

Quote from: pooya87 on August 15, 2020, 01:16:49 AM

Quote from: Agios on August 14, 2020, 07:33:57 PM

In recent weeks, the price of Bitcoin appears to have been driven by one main factor, namely the weakening of the US dollar.

US dollar losing its value is not something that happens over night, it is a slow process whereas bitcoin price went up about 30% in a short time. this particular rise has nothing to do with US dollar and its "weakening".
overall, there is definitely a connection but we will only see said effects over the long haul.

Quote

The Rekt Capital Twitter account supports the analysis,

oh some random dude on twitter, so it must be correct /s

3 months ago,one dollar was selling for 1.79 Bulgarian leva,now 1 USD is selling for 1.66 BGN.
There's a significant fall of the USD price,even compared with a very small national currency like BGN.
I think that making comparisons between the USD and other major currencies like euro and British pound isn't showing the real decline of the USD,because the EUR and the British pound are going down as well.
Many investors hedged their USD reserves by buying BTC,so the Bitcoin price went up.

actually if you want to know whether or not value of a currency has fallen you shouldn't compare it with another currency (even though most of the times it could be correct). in this case for instance it doesn't matter if USD is worth more or less against some other fiat, what matters is its purchasing power. for example did the rents go up? did the groceries go up? did the utilities bill go up? etc. all of these are going up because USD is declining in value but as i said over the long haul not in short term and not big like by 30%, at least not at the moment.

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Quote from: pooya87 on August 15, 2020, 01:16:49 AM

this particular rise has nothing to do with US dollar and its "weakening".

When you're comparing two currencies, isn't the rise of one of them the definition of the other one weakening? I'm no economist nor a currency trader, but that's been my understanding--please correct me if I'm wrong.

My take on why bitcoin is rising (along with precious metals and stocks) is that there's too much cheap money available to traders, and they're taking full advantage of it. When interest rates are near zero, margin trading goes up and usually stock prices do as well--or any asset that you can buy using leverage, and that includes cryptocurrencies. On top of all that, there's all of this "stimulus money" being handed out to people, and a lot of them are using it to speculate in various markets.

No surprise then that assets which aren't usually correlated start moving upward in tandem, which is exactly what we're seeing right now. One good thing is that bitcoin hasn't started moving into bubble territory, which makes me glad. There's all this talk about hitting a new ATH, but I'm hoping that doesn't happen for a few years.

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Quote from: Agios on August 14, 2020, 07:33:57 PM

No one can predict the future, but increasing global debt, slow economic growth and expanding central bank balance sheets have the potential to weaken the dollar and investors seek safe areas in assets like gold and Bitcoin.

Bitcoin isn't as safe as Gold because of it's very volatile nature. I don't think a lot of people would divert their wealth and store it to Btc. This significant rise maybe due to crypto enthusiast storing their wealth before the devaluation of national currencies become even worse.
The USD isnt the only currency that was down today, and not only the people from the United States are the investors/users of Bitcoin. Therefore, there's no strong correlation between the weakening of USD to Btc.

STT

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Weak dollar is a tail wind for sure but does mean we can drift off the road also. Money from a weak currency can flow anywhere and it doesnt have to be BTC certainly not all at once and we already rose a fair bit. I already rate 10k as a full price not attributable to any kind of negative outlook, fine long term.

We got a bit of a ceiling on the daily bars, its likely we reflect these longer term considerations at the moment. Usually speculators get impatient and sell some along the way. It could be said to be bullish with most of the low prices rising

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Quote from: joniboini on August 15, 2020, 01:48:22 AM

How the hell you can call it "one main factor" without comparing the rest of them? Don't blindly trust articles on the internet. Their methodology is flawed most of the times without adequate data or comparison to draw any reliable conclusion.

Bitcoin has been increasing for years without dollars weakening, not until now but this ain't the factor why we are seeing bitcoin price increasing today. One main factor that I can consider why the bitcoin is increasing these days are the beginner engagements with crypto. Crypto has been a hot topic since the beginning of the year, there are lots of events pointing to cryptocurrency good or bad it still affects the crypto community just like the twitter incident that happened month, it creates a buzz and gets to be in the news again for publicity although it's kinda off but for some who understands and has an open mind they got attracted to it giving a boost to some exchange. The new user rate of some exchanges is increasing during this time of pandemic.

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I'm thinking the drop of dollar is not having that kind of effect to the increase in the price of bitcoin. I believe awareness is higher now than even in 2017. So we are going to see more of price surging because people started to invest in online business and they also diversify into bitcoin.

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The dollar was strong in 2017 where the bitcoin grows and skyrocketed to $20k. Is there a direct effect of the dollar to the bitcoin, well we cannot totally say there is because the past situation is different from now but thinking in simpler ways, as dollar is weakening people will most likely to spend it rather than keeping it in low value and the fact that bitcoin is accessible people could easily look for it and buy it to store their value before it gets lower. Bitcoin have risen before even the dollar isn't weak, bitcoin's price has a core of speculation can't really tell directly.

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Bitcoin was also up versus the Euro and other fiat currencies so it wasn't just the drop of the Dollar that affected the price.

EUR/USD current price is 1.18 up from 1.08 in May. In USD terms perhaps a small percentage of the rise was because of this reason. In total it was not, it was a mixture of rising interest in Bitcoin from institutions, Robinhood stock traders, and speculators. Also that MicroStrategy company from the dot-com era that claims to have bought $250 million into Bitcoin.

It seems that there is actual interest and perhaps hodling BTC is the best option for a few more years.

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You can only attribute Bitcoin's growth to weakening of the US dollar if this weakening is easily observable to laymen, aka a hyperinflation scenario or just a real bad case of currency devaluation. You don't see it in the US, it has steady and predictable inflation. Bitcoin rapidly growth because it's just a new chapter of a speculative bubble like it was before many times already. Bitcoin can't be a real hedge for as long as it remains so speculative and volatile. Hedges are supposed to be predictable, Bitcoin is not.

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Quote from: Reatim on August 15, 2020, 12:36:43 PM

Quote from: eaLiTy on August 15, 2020, 12:30:39 PM

Quote from: Agios on August 14, 2020, 07:33:57 PM

No one can predict the future, but increasing global debt, slow economic growth and expanding central bank balance sheets have the potential to weaken the dollar and investors seek safe areas in assets like gold and Bitcoin.

The factors like global debt and a slow economic growth and on top of that the pandemic has put a lot of strain to the economy and you can be attributed that the rise in the price of BTCitcoin and other cryptocurrency market is due to these factors and no one can have a different debate as there is no concrete evidence on why all of a sudden huge investors are investing heavily in the market. You cannot call the cryptocurrency market a safe heaven and it is yet to prove that the market will sustain this growth if there is a global economic meltdown but these huge investors know that the market usually rises after every halving and they might be taking advantage of that common factor.

That's what I'm thinking, if bitcoin will continue to repeat itself then those big fat bag-holders are just preparing, accumulating
every cheap coins inside the market, allowing traders to enjoy this small rise that they've building around. Whales knows how
the sentiments of the traders and once they are convince, this people behind can triggered and point the direction according
to their plans.

In regards to US Dollar value, there's no clear information that it is part on why bitcoin value are surging, there's no connections
aside from forex investors who might be starting to divert their money.

I agree with you. Being both currencies and having moments on a certain period does not really correlate these two.
Bitcoin and US Dollar may both be affected by the macroenvironment however, but changes and impacts would not be really the same.
Reliable sources should be presented first before we could make such assumption regarding their connection.

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Quote from: eaLiTy on August 15, 2020, 12:30:39 PM

Quote from: Agios on August 14, 2020, 07:33:57 PM

No one can predict the future, but increasing global debt, slow economic growth and expanding central bank balance sheets have the potential to weaken the dollar and investors seek safe areas in assets like gold and Bitcoin.

The factors like global debt and a slow economic growth and on top of that the pandemic has put a lot of strain to the economy and you can be attributed that the rise in the price of BTCitcoin and other cryptocurrency market is due to these factors and no one can have a different debate as there is no concrete evidence on why all of a sudden huge investors are investing heavily in the market. You cannot call the cryptocurrency market a safe heaven and it is yet to prove that the market will sustain this growth if there is a global economic meltdown but these huge investors know that the market usually rises after every halving and they might be taking advantage of that common factor.

That's what I'm thinking, if bitcoin will continue to repeat itself then those big fat bag-holders are just preparing, accumulating
every cheap coins inside the market, allowing traders to enjoy this small rise that they've building around. Whales knows how
the sentiments of the traders and once they are convince, this people behind can triggered and point the direction according
to their plans.

In regards to US Dollar value, there's no clear information that it is part on why bitcoin value are surging, there's no connections
aside from forex investors who might be starting to divert their money.

eaLiTy

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Quote from: Agios on August 14, 2020, 07:33:57 PM

No one can predict the future, but increasing global debt, slow economic growth and expanding central bank balance sheets have the potential to weaken the dollar and investors seek safe areas in assets like gold and Bitcoin.

The factors like global debt and a slow economic growth and on top of that the pandemic has put a lot of strain to the economy and you can be attributed that the rise in the price of BTCitcoin and other cryptocurrency market is due to these factors and no one can have a different debate as there is no concrete evidence on why all of a sudden huge investors are investing heavily in the market. You cannot call the cryptocurrency market a safe heaven and it is yet to prove that the market will sustain this growth if there is a global economic meltdown but these huge investors know that the market usually rises after every halving and they might be taking advantage of that common factor.

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The dollar weakening has nothing to do with bitcoin rising up within just a few weeks.

The devaluation of dollar took years upon years of bad decision making and a series of bad luck among giant companies that make huge moves across the board. USD is not subject to hyperinflation similar to Venezuela and other countries which saw ATH on their currency against bitcoin. Likewise, the sudden rise in BTC/USD has nothing to do with USD being weaker day by day. It's more on the market and the current movements happening within it that made it possible for us to reach new heights these past few weeks.

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Whale manipulation will not be lost every time there is a surge of price in bitcoin based on the frequency and the consistency of spoof orders. We can't say that it was due to lower US dollar because the demand ans users of bitcoin comes from the whole world.

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Quote from: pooya87 on August 15, 2020, 01:16:49 AM

Quote from: Agios on August 14, 2020, 07:33:57 PM

In recent weeks, the price of Bitcoin appears to have been driven by one main factor, namely the weakening of the US dollar.

US dollar losing its value is not something that happens over night, it is a slow process whereas bitcoin price went up about 30% in a short time. this particular rise has nothing to do with US dollar and its "weakening".
overall, there is definitely a connection but we will only see said effects over the long haul.

Quote

The Rekt Capital Twitter account supports the analysis,

oh some random dude on twitter, so it must be correct /s

3 months ago,one dollar was selling for 1.79 Bulgarian leva,now 1 USD is selling for 1.66 BGN.
There's a significant fall of the USD price,even compared with a very small national currency like BGN.
I think that making comparisons between the USD and other major currencies like euro and British pound isn't showing the real decline of the USD,because the EUR and the British pound are going down as well.
Many investors hedged their USD reserves by buying BTC,so the Bitcoin price went up.

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