Free Forex Signals

The current US economic policies have trigerred a market shift in cryptocurrency. Our analyses looks at the ways below:

• Trade War Uncertainty:
  • US trade policies, particularly the imposition of tariffs, generate significant uncertainty in global markets.  
  • This uncertainty creates a “risk-off” environment, where investors seek to reduce their exposure to volatile assets.  
• Bitcoin as a Risk Asset:
  • Despite its proponents’ claims of being a “digital gold” or safe-haven asset, Bitcoin currently exhibits a strong correlation with risk assets like stocks.  
  • Therefore, when global markets experience a downturn due to trade tensions, Bitcoin tends to follow suit.
• Market Dynamics:
  • The fear of a global economic slowdown caused by trade wars leads to increased selling pressure on Bitcoin.  
  • Additionally, the high leverage used in cryptocurrency trading amplifies price swings, resulting in significant liquidations during sell-offs.  

Factors at Play:

• Investor Sentiment: Trade war news significantly impacts investor sentiment, leading to fear and panic selling.  
• Global Economic Concerns: The potential for a global recession due to trade disputes creates a bearish outlook for many assets, including Bitcoin.  
• Correlation with Traditional Markets: Bitcoin’s increasing correlation with traditional financial markets makes it susceptible to their fluctuations.