There’s some wild exuberance in the crypto corners of the U.S. markets as we look at current trading activity that shows Bitcoin and other cryptocurrencies moving up the down staircase.
In other words, while S&P 500 and DJIA are both backing off of all-time highs and really tanking a couple of hundred points each, crypto stocks are generally rising.
One of the biggest psychological factors is Bitcoin breaking the $6000 mark – and what this new wrinkle shows, to many analysts, is that the momentary downturn caused by the $40 million hack of the Binance exchange was really just a blip.
Some thought that the extreme heist of thousands of Bitcoins from Binance hot wallets was going to dog the cryptocurrency sector for a long time. It turns out the effects didn’t last more than a couple of days – now Bitcoin is healthy above $6000 since the middle of this week, and that’s major reason for coin enthusiasts to rejoice.
As an extra present, Ethereum and Ripple are both up, too.
“(The) largest altcoin by market cap Ethereum has seen milder price action, and is up 0.8% on the day to press time to trade at $171.47,” writes Marie Huillet this morning at Cointelegraph. “Having almost broken the $180 mark on May 7, ether subsequently dropped to as low as $166. Despite the correction, the altcoin retains a 6.3% gain on its 7-day chart – XRP has similarly seen a very slight gain on the day, up by just 0.13% to trade around $0.300 to press time. XRP saw its weekly high of $0.316 on May 4 before correcting downwards in recent days — seeing its lowest price point of $0.297 on May 6. On the week, XRP has seen a 1.3% loss.”
From the vantage point of today’s open market, Huillet also notes the sagging of U.S. index stock futures in general.
“In traditional markets,” Huillet writes, “United States stock index futures opened lower this morning, following president Trump’s negative remarks about ongoing fraught trade talks with China, as CNBC reports. As of 02:23 a.m. ET, Dow futures reportedly fell 122 points, CNBC notes, ostensibly indicating a negative open of more than 33 points. Futures on the S&P500 Index and NASDAQ were also slightly down.”
When we talk about “up the down staircase” moves, we’re often talking about investors meeting each other going both ways in the stairwell. Investors benefit from getting a fire sale when there’s a major selloff.
This time we’re talking about two major stock baskets and their inverse moves – in other words, the general markets are down, and cryptocurrency is, by contrast, way up.
The philosophical question for crypto traders is whether their buy-and-hold strategies in Bitcoin or other options are buttressed by the idea that the general stock market is both volatile and due for a correction.
The sand castle seems to be built on rather shaky ground, as today’s analysts cast a baleful eye at Federal Reserve rate future activity, as well as the US/China trade debacle which has worsened this week.
Stay tuned as we track the general markets and the crypto market in particular – and today we all join in celebrating Bitcoin’s health. Salud!