A BTC/ETH Disaster Survival Guide
9 March — 13th March Cryptocurrency market analysis
US stocks
With the global outbreak of Coronavirus, the US economy may have fallen into recession. The Trump administration is actively considering invoking the 1988 Stanford Act to enable Federal Emergency Management Agency to coordinate disaster relief efforts, which will release up to $ 40 billion in federal relief funding. After the New York Fed raised the upper limit of the overnight repo operation to $ 175 billion, the decline in US stocks slowed down slightly, but then it continued to plunge.
At present, the recovery of US dollar assets is not only held back by the pandemic and the plunge in crude prices, but also faces the debt problems of the US non-financial corporate sector. In fact, the space for US fiscal and monetary policy to take effect is very little.
A Shares
In this round of re-allocation of global capital from developed markets to emerging markets, hedge funds may escape into China market in mid-term. Judging from the current stage of market development, impact of fiscal and monetary policies, market liquidity and potential performance, a long-term growth of China A-shares market will be expected.
When the traditional economic model faces challenges, it means a large-scale of investment capital will flow into the field of innovation to trigger a technological revolution. At present, people are looking forward to see a new round of economic boost from China’s “new infrastructure” plan.
Risk
BTC is strongly influenced by the risk preference of the macro market during the plunge of US stocks, so we see that BTC also dived quickly this week. People tend to believe that BTC is no longer a purely safe-haven asset according to its market performance in past decade, but rather with a similar risk appetite to that of the macro market.
Opportunity:
We have seen some quite good news happening this week. As India lifts ban on cryptocurrencies, 1.5 billion people will be allowed to access digital currencies. In addition, major funds in the western financial circle (Grayscale, Fidelity, BAKKT, CME, etc.) have begun to purchase digital currencies, but the market is still too small and too early to pull the market price back.
BTC
As US stock price hits critical circuit breaker levels again, institutions had to cover margin call urgently in U.S stocks by withdrawing money from gold and cryptocurrency market. Therefore, a strong linkage between the US stock market and the Bitcoin market has been proved. With BTC reaching the seasonal MA20, it is still possible that BTC price might return to the position of 3,500 USD soon, but still no-one can clearly predict when the market might bottom. Everything might be clear after the Fed’s scheduled meeting on March 18th. Investors just need to calm down and wait.
ETH
On the morning of the 13th, ETH plunged to a lowest level of 88 USD and currently fluctuates around 120 USD. The buy or sell signal is not clear yet, as it is possible that both short and long traders will be challenged. But after all, the ETH market trend is following BTC market. Investors should be patient for the market to get stabilized before making any further moves.
HYN
Compared with the market panics of mainstream currencies, HYN price has maintained at a relatively stable level around 0.07 US dollars, which is an ideal long-term crypto asset to hold. During the market downturn, the Hyperion team is working on the blockchain technology infrastructure to accelerate the launch of MainNet. When Hyperion ecosystem goes on-chain, a new wave of price surge can be expected.
Disclaimer
The information in this analysis is personal opinions only and is not investment advice. Please do your own research before making any investment decisions. Cryptocurrency investments are volatile and high risk in nature. Don’t invest more than what you can afford to lose.
