Home>EXCHANGES>A U.S. Stimulus-Backed Rebound Could Fuel a Bitcoin Bull Rally: Here’s Why
EXCHANGES

A U.S. Stimulus-Backed Rebound Could Fuel a Bitcoin Bull Rally: Here’s Why



Bitcoin kicked off this week with a modest move higher, rising 0.78 percent as of Monday’s close.
The gains followed a sharp sell-off last week as traders pinned their hopes on a new stimulus package by the Federal Reserve and the U.S. Congress.
The sentiment helped S&P 500 pare part of its last week’s losses. The U.S. index and Bitcoin have formed a short-term positive correlation.

Bitcoin’s rebound from last week’s low shed lights on its growing dependency on macroeconomic fundamentals.
The benchmark cryptocurrency on Monday surged 0.78 percent to $9,184.45, a move that aptly tailed the recovery sentiment in the S&P 500. Like Bitcoin, the U.S. index climbed on Monday to pare its recent losses, rising 44.19 points, or 1.5%, to 3053.24.
Speculative Optimism
S&P 500’s Wall Street peers, Nasdaq Composite and Dow Jones, also inched higher by 2.3 percent and 1.2 percent, respectively. The Wall Street Journal credited “pure speculative optimism” for the S&P 500’s rebound, noting that expectations of a new stimulus package kept traders bullish about the index.
S&P 500 chart showing its intraday rebound on Monday. Source: TradingView.com
The S&P 500 peaked at 3,233 in June. It is on track of reaching its all-time high even as conflicting poor fundamentals led by the rise in COVID infections jitters investors.
Observers believe that the Federal Reserve and the U.S. Congress will keep injecting money into the economy to help sustain the rebound.
“There’s a safety net under the bond market and the equity market,” said Philip Blancato, the president of Ladenburg Thalmann Asset Management.
Meanwhile, Bitcoin’s 150 percent price rally from its March 12 nadir has also appeared out of the same stimulus efforts. The hardcore cryptocurrency community sees the Fed’s $7 trillion cash injection as inflationary. Therefore, they tend to park their fiat into bitcoin, an asset with a limited supply cap of 21 million tokens.
More Recovery Ahead for S&P 500, Bitcoin
Macro fundamentals developed during the COVID pandemic crisis have prompted Bitcoin and the S&P 500 to form an erratically positive correlation. Therefore, whatever that moves the U.S. benchmark index could prove equally influential for the world’s leading cryptocurrency.

Global stocks resume uptrend on expectation of more stimulus as investors shrugging off more neg virus news. US sees record number of corona cases on Thur. US Banks surged after regulators eased rules that will free up capital. Bonds gain w/US 10y 0.67%. Gold $1761, Bitcoin 9.2k. pic.twitter.com/ayxVCyJaCD
— Holger Zschaepitz (@Schuldensuehner) June 26, 2020

And by the look of it, the S&P 500 has room to grow further. So says Tony Dwyer, a prominent market analyst.
The Canaccord Genuity’s chief market strategist on Monday recommended investors to purchase the S&P 500’s dips as he set his 12-18 months target for the index to 3,300. The new projection puts it 9 percent higher from where it closed on Monday.
“Following the initial ramp to 3,200, we have been anticipating a multi-week/month period of consolidation with the intention of incrementally adding risk each time the SPX pulls back to 3,000,” Mr. Dwyer wrote in a note to clients.
Nevertheless, the veteran investor added that he sees the Fed’s “incredible monetary stimulus,” as well as improvements in the credit market and liquidity to improve the S&P 500’s outlook.
Bitcoin, for now, is treading in a similar scenario. The cryptocurrency’s price rally towards the $10,000-10,500 area in early June met with higher selling pressure. It later corrected lower towards $9,000 and has been since consolidating sideways for weeks.
Bitcoin price chart showing its recovery from March 2020 lows. Source: TradingView.com
Bitcoin could attempt a bull run, nevertheless, should the Fed announces another stimulus package. The decision will come sometime in mid-July. Until then, it is likely for traders to hold the cryptocurrency above $9,000, a technical support level.
Featured Image from Shutterstock
Price tags: xbtusd, btcusd, btcusdt
Charts from TradingView.com

Post source: A U.S. Stimulus-Backed Rebound Could Fuel a Bitcoin Bull Rally: Here’s Why

More Bitcoin News and Cryptocurrency News on TheBitcoinNews.com





  • Bitcoin
  • Ethereum
  • Bitcoin cash
  • Litecoin
  • Cardano
  • Dash
  • Stellar
  • Ethereum classic
  • Lisk
  • Tron
  • Neo
  • Qtum
  • Omisego
  • Binance coin
  • Zcash
Scan to Donate Bitcoin to 1J6PGL1oemFb3hxabLygq4WgWx8cbfji1r

Please help us if you can with some Bitcoin

Scan the QR code or copy the address below into your wallet to send some Bitcoin

Scan to Donate Ethereum to 0xA8E701dd11280a98e8F2e0A14064AC829E32D50F

Please help us if you can with some Ethereum

Scan the QR code or copy the address below into your wallet to send some Ethereum

Scan to Donate Bitcoin cash to qrth4e0g93h3gpxex8ycwuxtsa332tha5qvkmlz0g5

Please help us if you can with some Bitcoin cash

Scan the QR code or copy the address below into your wallet to send some Bitcoin cash

Scan to Donate Litecoin to LTxxjySMDtERJhHYJ99UFW9AamAWTwCAZ4

Please help us if you can with some Litecoin

Scan the QR code or copy the address below into your wallet to send some Litecoin

Scan to Donate Cardano to DdzFFzCqrhsopoZLhbouUwh2NvvWMPeFrXQW9vNNpPKrjKbRGyLRN5joJgCeZ6e1MRHtPHeLffpkNpQs5AdDA8qFCZ4gA9bYtaerNQTk

Please help us if you can with some Cardano

Scan the QR code or copy the address below into your wallet to send some Cardano

Scan to Donate Dash to XmAdEHrwiVZJVkAxe8hK5U6HZB59L5yhmK

Please help us if you can with some Dash

Scan the QR code or copy the address below into your wallet to send some Dash

Scan to Donate Stellar to GD4KROE42HPOMT7BT6M27HHLFCOSIXPYY2V3WSCX5FYEWRJDIJQ4RWFT

Please help us if you can with some Stellar

Scan the QR code or copy the address below into your wallet to send some Stellar

Scan to Donate Ethereum classic to 0x5BF3fCAC8deA20CF21C9D0D9d058E00EEfc431Ae

Please help us if you can with some Ethereum classic

Scan the QR code or copy the address below into your wallet to send some Ethereum classic

Scan to Donate Lisk to 15642042552518336132L

Please help us if you can with some Lisk

Scan the QR code or copy the address below into your wallet to send some Lisk

Scan to Donate Tron to TYnAenRiV6BsTiE6FVyAcDDxZtBKUQTFxN

Please help us if you can with some Tron

Scan the QR code or copy the address below into your wallet to send some Tron

Scan to Donate Neo to ATiXRHVqYqrNktbxJfcDETfnrSUWSG4cPb

Please help us if you can with some Neo

Scan the QR code or copy the address below into your wallet to send some Neo

Scan to Donate Qtum to QUYXxY6kX7TY2HSLwVYMwFaJNZLwvX5uyp

Please help us if you can with some Qtum

Scan the QR code or copy the address below into your wallet to send some Qtum

Scan to Donate Omisego to 0xA8E701dd11280a98e8F2e0A14064AC829E32D50F

Please help us if you can with some Omisego

Scan the QR code or copy the address below into your wallet to send some Omisego

Scan to Donate Binance coin to 0xA8E701dd11280a98e8F2e0A14064AC829E32D50F

Please help us if you can with some Binance coin

Scan the QR code or copy the address below into your wallet to send some Binance coin

Scan to Donate Zcash to t1cBCyKgSSqWaNrkpvQZUSTuxMmAbbAyFpZ

Please help us if you can with some Zcash

Scan the QR code or copy the address below into your wallet to send some Zcash



Source link

Review Overview

Summary