A widespread debate among investors is the correlation of Bitcoin with other markets.
A high degree of correlation between the equity markets and Bitcoin has existed, particularly in the last few months.
The chart above shows gold, Bitcoin, and dollar values since the crash in March.
The orange line is gold, the blue line the U.S. Dollar Currency Index, and the regular price of Bitcoin is shown by the black line.
Bitcoin has increased 185% since the crash of March while Gold rallied 31%.But despite the general downtrend still intact, the U.S. dollar has seen a relief bounce in early September as a bottom construction was made.
The previous cycle highs were hit in 2014 and 2017 for Bitcoin, through which credible data can be derived from the correlation between the U.S. Dollar and Bitcoin.
A substantial weakness of the DXY index is causing the price of Bitcoin and Gold to continue rallying.
Dollar weakness after the Dot.com bubble lead to a 600% surge in Gold.
In the current times of uncertainty with negative interest rates, increased debt levels, and deflation, Bitcoin is also doing relatively well.
Bitcoin and gold would benefit significantly afterward as safe havens against a weakening dollar, which is precisely what happened in December 2017 as BTC hit its all-time high of nearly $20,000.
Bitcoin vs. USD: why only a weaker dollar will push BTC above $20,000
Published on Sep 30, 2020
by Cointele | Published on Coinage
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