Fighting is not the central bank. These words are not on deaf ears fallen, and the bitcoin exchange rate to follow a good for the price, which, in turn, are driven by the central bank. The correlation between the stock market index S&P 500, and bitcoin is no less than 95%.
In this article, we are going to go any deeper into the relationship between stock prices and bitcoin, and we will share a technical analysis of the stock price.
The support of the resistance
We start with a technical analysis. Here you can see the bitcoin exchange rate as of may right through to the present. The graph is expressed in terms of dollars, but each and every candle on the chart represents four hours.
The three horizontal lines represent the main levels of the past few weeks. At the end of may and beginning of June, the orange line will be a strong focal point. On a 9.250, the $ 8.236 euro) is of the opinion that the rate to each of the support.
But last week, on Thursday dropped to bitcoin is due to the support around you. And, in fact, 9.250 dollar now seems to be a resistance to it. The two times I managed bitcoin is not a price break. That is, we display it on the chart by the two red arrows.
If the stock price drops more than 8.700 usd (7.746 euros) to the next level in order to keep an eye on. The graph above shows this with the red line. This is a red line, especially in the beginning of may, and a strong support. A fall on this line again and again for support, take care.
The time for the next graphic, below, you can see the same areas, but we do have a vehicle. Also, in the past, the prices of the important levels have been, as well as support, as resistance.
When it pulls bitcoin the market?
We have seen it is like to be different, but at the moment it is moving bitcoin is still with the U.s. stock market. Bitcoinners to see the cryptomunt like to work as an uncorrelated asset, but as of Wednesday, the 10th of June following bitcoin for almost every step of the S&P 500 and the Dow Jones.
You can see in the chart below, in return. You can see that the bitcoin price is in the green, and the S&P 500 in the red.
The big question is, how long can this relationship between bitcoin and the stock market work?
According to the analyst, PlanB, the answer is simple: thank you. But, according to him, is not to be a problem. A well-known saying goes: “Don’t fight the FED”, or not opposed to, the actions of the united states ‘ central bank. PlanB has estimated that bitcoin is-for a 95 per cent correlation with the S&p 500 is a stock market index of 500 of the largest companies in the United States of america.
“Don’t Fight the FED” is the old Wall Street wisdom.
The Great thing is that #Bitcoin is fully aligned with FEDERAL interests (QE to save the banks & companies. BTC is correlated (more than 95% of R2), and cointegrated, with US equities (S&P500). So the BTC is not an uncorrelated asset, and supported by FEDERAL reserve action. pic.twitter.com/xYaFLS3Wl0
— PlanB 🔴 (@100trillionUSD) on June 21, 2020
He compared it to the logarithmic chart of bitcoin is the logarithmic chart of the S&P 500. He added that the price movements of bitcoin is stronger than the S&P 500. With the doubling of the S&P 500, the bitcoin exchange rate times a total of 416.
The earlier models will continue to be, according to him, will remain intact. This is because bitcoin is scarce, and its value is measured in dollars. The Federal Reserve will continue with its programme of quantitative easing-money printing, which makes the shares increase in value. Bitcoin can benefit from it, and partly because of inflation, the exchange rate in the coming years, rising to 288,000 usd.
The latter prize was for the prediction of the PlanB, on the basis of its newest model, the S2FX model. Here you can read more about PlanB and pricing.
#Bitcoin is scarce (measured by S2F), and people value it in line with the gold & silver (in $)
The BTC is also correlated & cointegrated with the S&p 500. According to S&P 2x =BTC 416x (in us dollars)
This can both be true! QE, shoes stock (cash-flow), and BTC (scarcity): “asset inflation in $. BTC is$288K ~ on the S&P is$4300 pic.twitter.com/Sgs0MBpCT2
— PlanB 🔴 (@100trillionUSD) June 27, 2020