The POTUS took a Coronavirus test a few hours ago which produced a positive result for him and the First Lady. Stock market futures reacted with an expected selloff, but crypto markets followed suit suggesting that they are no longer correlated with safe haven assets such as gold, which moved in the opposite direction.
Not all Bad For Bitcoin
In the couple of hours that followed the news breaking, Bitcoin lost 2.4% in a fall from $10,650 to just below $10,400. In the past hour, however, the asset has managed to recover to top $10,500 again making the move pretty insignificant for the volatile asset.
In fact, there was a larger decline for Bitcoin yesterday when it lost 4% after news broke that the owners of the BitMEX exchange were charged by the CFTC for violating multiple regulations and failing to implement anti-money laundering procedures.
Bitcoin is back at weekly resistance and further downwards pressure could send the asset back to support at $10,200. If the bears in the U.S. resume the selloff later today, even this level could be broken which would result in a plunge back into four figures.
One thing to emerge from this is the dissolving of the notion that Bitcoin is correlated to gold. Gold prices actually spiked after the news broke sending it back over $1,900/oz once again.
— Zack Voell (@zackvoell) October 2, 2020
Traders and analysts, such as the popular ‘Squeeze’ (@cryptoSqueeze) have observed that Bitcoin is still ranging, despite these two minor drop offs.
“Still ranging as long as we’re above $10k. And this would be the place to buy.”
What About Altcoins?
There was a decline of around $7 billion from total market capitalization with altcoins getting hit harder as is usually the case.
Ethereum lost over 5% in a fall back to $344, while XRP fell 3.5% to $0.233. Polkadot, Chainlink, Cardano, Monero, and Tezos fell harder losing around 7-8% each. DeFi tokens from Yearn Finance, Synthetix, UMA, and SushiSwap lost even more with double digit declines.
In the grand scheme of things, however, this is just another day on crypto markets – providing the selloff doesn’t accelerate into an all-out bloodbath when America wakes up later today.
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