Despite being called an uncorrelated asset, Bitcoin is frequently correlated with traditional markets when there is a significant price movements and change in sentiment, such as during a pump or crash.
Between these periods, Bitcoin can largely be considered uncorrelated, since it tends to move in a way that cant be predicted from the equities, bonds or commodity markets.
Topic: When the US stock market goes down Bitcoin goes down - page 2. (Read 1004 times)
When stocks drop that doesn't always means that there is money going out, not at least as much as you think there is because when someone wants to sell their stock and there is no buyers the price drops, as you can see nobody bought a single stock and nobody has any money in that situation, the price dropped just because nobody was willing to buy for that price and it had to drop.
Now, there is of course some money in bank accounts in fiat form instead of stocks after a big drop most of the time but not as much as you think. And one of the reasons why they are in cash form is the simple fact that people didn't wanted to be invested and wanted to be in cash just in case and wanted to make sure their money is not gone. Putting it in bitcoin doesn't really change that and wouldn't really help them at all.
Now, there is of course some money in bank accounts in fiat form instead of stocks after a big drop most of the time but not as much as you think. And one of the reasons why they are in cash form is the simple fact that people didn't wanted to be invested and wanted to be in cash just in case and wanted to make sure their money is not gone. Putting it in bitcoin doesn't really change that and wouldn't really help them at all.
Today, the US stock future goes down near 900 points then the bitcoin prices goes down too. It happened the same in March 2020 when the US stock market goes down then Bitcoin goes down $4500. Any one knows the psychology or the mood of the trader? Thanks.
This trend is just a recent trend and previously the reverse used to happen a lot of times. When the stock market used to fall there was always an increase in price of bitcoin and when the Chinese stock market used to fall some points then the bitcoin also used to loose its value but now this trend is changed. The same happened when the lockdowns were being announced around the world and Corona virus was declared as a pandemic but the recent fall didn't had any reason behind it.
According to studies of the coinbase cryptocurrency exchange, the cryptocurrency market does not have any dependence on the stock market, but nevertheless, today there is a certain connection between Bitcoin and the stock market, which first began to appear even in almost 2016. This is primarily due to the correlation between gold and Bitcoin. This connection was especially noticeable at first in 2019, when economic problems began to rise, which were accompanied by an intensification of the tense political situation in the world. And already in 2020, due to the spread of coronavirus, this situation is most palpable and is exacerbated very actively.
Today, the US stock future goes down near 900 points then the bitcoin prices goes down too. It happened the same in March 2020 when the US stock market goes down then Bitcoin goes down $4500. Any one knows the psychology or the mood of the trader? Thanks.
It was a panicked selling mood. is understandable because this is when the epidemic began to spread so people will not need to hold financial assets anymore. they will sell for a lot of cash so they can buy food. That is why when there is instability in the economy out there, the financial market will fluctuate so strongly. We are also investors and Bitcoin is just a financial asset, it will not escape panic selling.That's their way of surviving this pandemic, they do panic selling in order to buy their necessities as this quarantine really cause inconvenience to all of us. US stock market affects the bitcoin's price so much that if it goes down, bitcoin will also go down. Bitcoin's value is what we need right now to buy food for our family, but if you have some spare amount of money that you can use for your budget, then there's no need for you to do panic selling. Instead, you will still wait for the economy to become in a better state where bitcoin's price will improve and also the US stock market. This pandemic is not a long-term suffering. I believe that bitcoin will save us soon.
Today, the US stock future goes down near 900 points then the bitcoin prices goes down too. It happened the same in March 2020 when the US stock market goes down then Bitcoin goes down $4500. Any one knows the psychology or the mood of the trader? Thanks.
The first that happened during the first wave of the pandemic was the caused of the corona virus, which hit so hard on the world economic and causes the investors to fear the downtrends of the market. Investors want to see their portfolios growing and not in negative, this gave them the mind to sell off their investment. The recent downtrends was the fear of the second wave of the pandemic, at this time investors are more afraid to lose like the first wave. Either the cryptocurrency or stock investors, they are all afraid of loses. 
yes that is true. bitcoin follow stocks, but it should not be like that. when stocks falls money should flow into bitcoin
Perhaps it was due to the Covid-19 that is still up in the air (no pun intended). What I mean is that investors are still reluctant to invest to neither traditional stocks or crypto. That's why when there are negative news, both market crashes and investors are not moving their funds anymore.
So there is a tiny bit of correlation, unless everything has settled down and investors are willing to play in both markets again.
Today, the US stock future goes down near 900 points then the bitcoin prices goes down too. It happened the same in March 2020 when the US stock market goes down then Bitcoin goes down $4500. Any one knows the psychology or the mood of the trader? Thanks.
I think most of the investors stop investing because they know that the stock market goes down,crypto market will go down too because most of the people are lack of financial. Investors will also think that many people are not capable to invest and trade that's why they think that because stock market is down,they are going to panic selling which could lower the price of crypto.
The Crypto market is something correlated to the global stock market. Thus, the US stock market is a huge market player and that it has a big influence on the market trend. Besides, we all dump so hard at this time since we are still facing the pandemic. It probably investors will wait for the market to replenish and they'll turn back to crypto investment well. What they have in their mind today is to combat the crisis and that investing will commence later. It is so much to have a huge impact on Bitcoin's price and see the declining sentiments than driving it high.
yes that is true. bitcoin follow stocks, but it should not be like that. when stocks falls money should flow into bitcoin
That is what we have today. It holds the market to soar high and it takes the level below $10k.
yes that is true. bitcoin follow stocks, but it should not be like that. when stocks falls money should flow into bitcoin
If the US stock market goes down, maybe that gives effect to the bitcoin market. I think it provides psychology with an effect on the trader, and they think that the stock market and bitcoin market will be related. So when the US stock market down, the trader will cash out their money while also waiting for another time to buy at a low price. It can give the effect to the bitcoin market, in which traders watch what is going on with the stock market.
Nothing will happen to the economy because bitcoin is not apart of the economic system. The only thing is when it does crash those that invested in bitcoin will lose their investment. Bitcoin Price Drop to $8.9K Raises Fear of a New Bear Trend Beginning. Traders fear Bitcoin could be entering a new bearish trend after the price dropped below $9,000 earlier today.
Crypto market is a market that is not controlled by anyone, so it will definitely not affect the global economy. I think Bitcoin's decline is often due to panic psychology when reading a piece of bad news about the market. In general, there is no exact comparison between both the stock market and crypto market because each market has its way of operation and different volatility. You can only call it a "coincidence" when something happens once or twice. BTCUSD and the S&P 500 are nearly identical from mid-February to present. For the last week as the stock market threatened to crash, BTC followed in lockstep, and also recovered in lockstep.
In my opinion it's obvious that if stocks go in the shitter, so will BTC.
In my opinion it's obvious that if stocks go in the shitter, so will BTC.
it IS a coincidence because it only happened ONCE and never before and never after.
That is really not true at all.
BTC and stocks correlate well historically. You can confirm this by using an asset correlation calculator. Comparing BTCUSD with SPY or DJI over its 10 year history reveals very strong correlation above 0.8. You can also confirm this visually by overlaying charts.
More importantly, the markets are moving in lockstep now.
if anything bitcoin is following the pandemic and world economy in general as people lost their income, some lost their job, and a large percentage lost a lot of money. THAT affected everything including stock market, bitcoin market, oil market, gold market,.... bitcoin is still not following stock market.
The two are correlated. The point is they are moving together and will likely continue doing so.
Bitcoin is not apart of the economic system. The only thing is when it does crash those that invested in bitcoin will lose their investment. If the stock market crashes, that usually means unemployment rises, and if you don't have a job, you won't be able to make your payments. When stock markets crash, investors usually move their money to the Bond Markets until stability returns to the Stock Market.
I disagree, what do we use to measure the value of a bitcoin? Fiat, right? Which means that bitcoin is part of the economic system whether we like it or not, the truth is that as bitcoin becomes more popular and institutional investors become interested in this market to the point of investing in it then it makes sense for bitcoin to move in a similar way to other markets, after all if the stock market goes down even if this is unrelated to bitcoin the investors that have put their money in both markets will probably sell their bitcoin to cover their losses in the stock market making the price of bitcoin to go down as a result. 
You can only call it a "coincidence" when something happens once or twice. BTCUSD and the S&P 500 are nearly identical from mid-February to present. For the last week as the stock market threatened to crash, BTC followed in lockstep, and also recovered in lockstep.
In my opinion it's obvious that if stocks go in the shitter, so will BTC.
In my opinion it's obvious that if stocks go in the shitter, so will BTC.
it IS a coincidence because it only happened ONCE and never before and never after.
if anything bitcoin is following the pandemic and world economy in general as people lost their income, some lost their job, and a large percentage lost a lot of money. THAT affected everything including stock market, bitcoin market, oil market, gold market,.... bitcoin is still not following stock market.
Nothing will happen to the economy because bitcoin is not apart of the economic system. The only thing is when it does crash those that invested in bitcoin will lose their investment. Bitcoin Price Drop to $8.9K Raises Fear of a New Bear Trend Beginning. Traders fear Bitcoin could be entering a new bearish trend after the price dropped below $9,000 earlier today.
Bitcoin is not apart of the economic system. The only thing is when it does crash those that invested in bitcoin will lose their investment. If the stock market crashes, that usually means unemployment rises, and if you don't have a job, you won't be able to make your payments. When stock markets crash, investors usually move their money to the Bond Markets until stability returns to the Stock Market.
Agree! All of the markets are affected directly by the economy. Especially in the pandemic, the economy of the world is hardly increasing. Therefore, cryptocurrency market is not an exception, it also decreases! It's not too surprised though!Proper manipulation of your assets is the key to minimize the effect of crash to your bitcoin. Stock markets are vulnerable every time and their are a lot of factors that can trigger it, including the trading volume. You should know when to invest in bitcoin so that you will not suffer when stock market will go down.
Bitcoin is still a part of economic system as it brings some advantages and disadvantages in the market. Not only stock markets are affected, physical assets and other valuable things are also affected that's why the market depends on the people who actually operate and contribute to the activities in the market.
Today, the US stock future goes down near 900 points then the bitcoin prices goes down too. It happened the same in March 2020 when the US stock market goes down then Bitcoin goes down $4500. Any one knows the psychology or the mood of the trader? Thanks.
The price hasn't dropped much when compared to the price of stock. Usually people expect the opposite to happen (and I think the opposite thing does happen). When the stock starts to fall, people starts withdrawing their investment and then starts investing on bitcoin causing the price of bitcoin to increase.This year was a bit exceptional though. The stock and the price of BTC followed, and this was due to people panicking.
It does affect the market of bitcoin.
But there is a question here.
How will you know which goes first?
Bitcoin market could go down anytime because of volatility. Will that mean the stock market will do so, afterward?
But there is a question here.
How will you know which goes first?
Bitcoin market could go down anytime because of volatility. Will that mean the stock market will do so, afterward?
The price changes we talk about usually take place in almost the same process, so it is difficult to predict which one will take place earlier. Moreover, since the changes we mentioned are instantly following each other, it is not even possible to make an assessment in case of a possible forecast. In general, all we can do is to anticipate bad market conditions and arrange our transactions in accordance with these conditions. However, we can analyze such decline situations in advance and evaluate these opportunities.
Bitcoin became this corporations commodity thing few years ago. I don't know when it first happened but it wasn't really slowly going up thing, it was a sudden thing. Maybe it was the 2017 December peak when they saw that $20k or maybe some time later or before?
Maybe they were the ones that made it $20k to begin with? I am not really sure but all those wall street type companies (not just wall street as a location but the idea) all got interested in bitcoin and that caused a correlation between stock market and bitcoin. Before that we were independent and different, after that it is all them, when they sell their stocks because of a crash they sell their coins too, when they buy stocks for profit they buy bitcoin too, it became too attached to each other because of them.
Maybe they were the ones that made it $20k to begin with? I am not really sure but all those wall street type companies (not just wall street as a location but the idea) all got interested in bitcoin and that caused a correlation between stock market and bitcoin. Before that we were independent and different, after that it is all them, when they sell their stocks because of a crash they sell their coins too, when they buy stocks for profit they buy bitcoin too, it became too attached to each other because of them.
Jump to: