- Bitcoin up over 5% since dropping to $7,500
- Global markets take a hit as investors price in that trade tensions likely to linger
Bitcoin has made recovery from yesterday's drop below $7,507 as it currently trades at $7,940 with 24-hours gains of more than 6 percent. With the leading cryptocurrency going up, altcoins are also turned green as the total market cap goes to $244 billion.
In the last few days, BTC/USD has been struggling at around $8,000 but in the month of May, it has seen significant greens as it records 115 percent gains till date in 2019.
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- Bitcoin up over 5% since dropping to $7,500
- Global markets take a hit as investors price in that trade tensions likely to linger
Bitcoin has made recovery from yesterday's drop below $7,507 as it currently trades at $7,940 with 24-hours gains of more than 6 percent. With the leading cryptocurrency going up, altcoins are also turned green as the total market cap goes to $244 billion.
In the last few days, BTC/USD has been struggling at around $8,000 but in the month of May, it has seen significant greens as it records 115 percent gains till date in 2019.
This surge in Bitcoin price coincided with the gold price rising amidst the US-China trade war and weaker domestic data that has US dollar slipping and stocks falling.
As we reported, crude oil prices fell alongside the S&P 500 amidst the deterioration in market-wide risk appetite. During the ongoing US-China trade spat, gold has been treated as an investment that has its prices rising but not by much.
This is because Yuan has weakened over the past two weeks that is hurting gold but the same isn't the case for Bitcoin. This trade war will rather push people towards the world’s largest cryptocurrency.
The yellow metal is up about 0.5 percent and on track for a weekly gain as the US dollar dropped after hitting its highest level in two years.
“Investors haven’t been treating gold as hedge, but rather an investment. During times of geopolitical turmoil, investors have flocked to U.S. Treasurys, the U.S. Dollar and the Japanese Yen for protection,”
said FX Empire senior market analyst James Hyerzyk.
He further explained that it’s not just the headlines rather a combination of weaker US Dollar, drop in demand for risky assets, and lower Treasury yields that drive attention from strong buyers.
Weakness in US and global markets can be seen as markets price-in that the trade tension is likely to linger. Additionally, investors are digesting the implications of new US export restrictions on Chinese telecom firm Huawei Technologies Co.
“Markets are pricing in the harsh reality that trade tension is more likely to linger than quickly be resolved as had been the consensus expectation anchoring sentiment until late April. In addition, the fact that Wednesday’s Fed minutes indicated no rush to cut rates isn’t helping, nor is seemingly endless Brexit uncertainty,”
said Alec Young, managing director of global markets research at FTSE Russell.
Meanwhile, China has taken a hard stance, stressing that trade talks can only continue if US adjusts its “wrong actions” said Gao Feng, a spokesperson for China’s Ministry of Commerce.
This has also traders shorting the S&P 500 at a rate that hasn’t been seen since 2005 when the Federal Reserve's started raising interest rates, reports Bloomberg.
Since then, the markets have bounced back as US President Donald Trump suggests Huawei could join the trade deal.