It looks like we’re seeing another one of those iconic 2020 multi-asset sell-offs to start this fragile week. Click to tweet
As we mentioned last week, the Federal Reserve and other central banks have already injected quite a lot of stimulus and are already committed to keeping rates suppressed for a long time to come, so there doesn’t seem to be much in the way of action from them for markets to look forward to.
In the markets of course, there’s always a winner, and today is brought to you by the U.S. dollar, which is the main benefactor of today’s action. The Dollar Index is now nearing it’s highest level since July.
Though some traders might try and take advantage of the current highs (94) and lows (92) to trade the range, I’m really seeing this more as a consolidation period and waiting for a breakout in either direction. A strong dollar surge could really catch a lot of traders unprepared at this point.
Back to 10k
Though most traders might be completely spooked by a loss of nearly 5% in a day, bitcoin hodlers aren’t breaking any sweat. Even the old memes depicting the hodl mentality have begun to fade.
The price per bitcoin is $10,000, and it has traded around this level with few exceptions since mid-2019. The average price over the last 200 days is now just shy of $9,200.
So, while stock traders are currently dealing with a two-month low in a market that’s largely driven by momentum, bitcoin is seeing incredible stability in a market that’s largely been driven by stocks.
True believers, however, are quite sure that it’s only a matter of time before we see a true decoupling, when these multi-asset sell-offs won’t affect crypto assets quite as much. I guess we’ll need to wait and see how this plays out.