Will Bitcoin Drop Lower on Trump’s Positive Covid-19 Test News?
Following a positive Covid-19 test result from one of Donald Trump’s closest aides, the POTUS himself took the test which produced the same result for him and the First Lady. He tweeted the news a couple of hours ago.
Tonight, @FLOTUS and I tested positive for COVID-19. We will begin our quarantine and recovery process immediately. We will get through this TOGETHER!— Donald J. Trump (@realDonaldTrump) October 2, 2020
Global stock markets have already reacted in a heavy slide, and crypto markets appear to be following them downwards at the time of writing.
Bitcoin Dumps to Weekly Low
Bitcoin fell 2.5% as the news broke dropping from $10,660 to $10,390 according to Tradingview.com. However, there was a larger fall when the BitMEX news broke a few hours before that.
There has been a minor recovery to the $10,470 level at the time of writing which has put the asset back to weekly support.
Looking at the longer-term view, Bitcoin is still within its range-bound channel and this reaction by the news-selling bears has been just a blip.
Crypto trader, ‘Farmer Bluntz’ pointed out that Bitcoin was no longer correlated to gold but more so to equities. Gold prices spiked over a percent following the news taking the precious yellow metal back over $1,900/oz again.
$gold pumping, $btc dumping on this news.— 👨🌾Farmer Bluntz👨🌾 (@SmartContracter) October 2, 2020
i think, once and for all we can all agree that #btc is not correlated to gold and is correlated to equities, no chopping and changing whenever it suits our bias, this is how it is now. pic.twitter.com/AlMlW3MW15
Naturally, the crypto detractors and Bitcoin bashers such as permabear Nouriel Roubini delighted in the fact that markets were plunging.
There will always be the disparagers but the fact remains that Bitcoin is still in a six-month uptrend, and has gained 45% since the beginning of this year. If the slide continues, Bitcoin could find support at $10,200, but below this the next level is in the low $9k range.
Naturally, the rest of the digital lemmings followed Bitcoin’s brief dip and total market capitalization has shrunk by 8% since the news broke a few hours ago.
Ethereum has lost around 5% in a fall back to $345 but it too is still within its sideways channel which has formed over the past couple weeks.
DeFi tokens are taking the biggest 24-hour hits at the moment with YFI, SNX, UMA, BAND, KNC, SOL, SUSHI, and COMP all dropping double figures.
There may be more pain before gain, but as we have seen countless times before, this is just another normal day for crypto markets regardless of who happens to have caught the Coronavirus.