Bitcoin (BTC) Could Be Pulled Down By Weakening Stocks and Gold

 

However, 2020 still has one mega tournament for Bitcoin in the shape of the US elections on the third of November. This capability that Bitcoin may want to be in for a very unstable two weeks based totally on its correlation to the common markets and gold.

In terms of Bitcoin’s relationship with the inventory markets, the crew at Weiss Ratings has warned that the next few days could be very risky and unstable for Bitcoin due to the aforementioned US Elections.

We’ve noticed a excessive correlation of #BTC to fairness markets. This is bad, because presently – due to US election hastily drawing near – stock market has a lot of headline risk, and correlation transfers all that useless volatility to #Bitcoin.

Additionally, the correlation between Bitcoin and Gold has endured to expand considering that mid-June as can be seen in the following chart courtesy of CoinMetrics.io.

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BTC/GOLD correlation chart courtesy of CoinMetrics.io

Furthermore, the contemporary state of Gold in the markets is one of momentary bearishness with the charge of Gold currently trading at $1,898 and below the 50-day moving average. From the weekly chart, the fee of Gold is very overextended after its recent top at around $2,077 as considered in the weekly chart below. Also from the weekly Gold chart, it can be located that the MACD is showing signs and symptoms of weakness as well as the weekly RSI.

Bitcoin (BTC) Could Be Pulled Down By Weakening Stocks and Gold 18

Weekly Gold/USD chart courtesy of Tradingview.com

Conclusion

Summing it up, Bitcoin is exhibiting symptoms of bullishness as it continues on its slow but certain climb above $10k and $11k. However, the next two weeks leading up to the US elections might pose to be a short-term risk to Bitcoin’s momentum given BTC’s correlation to shares and gold. The latter two property may want to be negatively affected by using the November 3rd elections bringing down Bitcoin with them.

Therefore, Bitcoin merchants and investors are recommended to be cautiously positive till a winner of the elections is declared. Once a winner is known, the inventory markets will modify hence and subsequently stabilize for that reason giving Bitcoin a risk to proceed thriving.