When the US stock market goes down Bitcoin goes down

[exstasie]

the only thing that has happened over the past 11 years is that this year after all this time we had a very gigantic drop in stock market and a lot of other markets then bitcoin dropped too.

That suggests short term correlation among all those markets. It doesn't suggest the drop was a random occurrence.

The Dow and S&P 500 actually have decent long term correlation with BTC. I have no idea why people try to assert there is no relationship at all. Just overlay the charts.

now if another market coincidentally dropped while bitcoin was doing its own thing you can't call that "bitcoin following that market"!

You can only call it a "coincidence" when something happens once or twice. BTCUSD and the S&P 500 are nearly identical from mid-February to present. For the last week as the stock market threatened to crash, BTC followed in lockstep, and also recovered in lockstep.

In my opinion it's obvious that if stocks go in the shitter, so will BTC.

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[Lorence.xD]

Today, the US stock future goes down near 900 points then the bitcoin prices goes down too.  It happened the same in March 2020 when the US stock market goes down then Bitcoin goes down $4500.  Any one knows the psychology or the mood of the trader?  Thanks.

It was a panicked selling mood. is understandable because this is when the epidemic began to spread so people will not need to hold financial assets anymore. they will sell for a lot of cash so they can buy food. That is why when there is instability in the economy out there, the financial market will fluctuate so strongly. We are also investors and Bitcoin is just a financial asset, it will not escape panic selling.

The reason that there is a panic selling mood is because bitcoin is closeky tied to USD, my currency is basing its bitcoin prices on the value of USD, I do not think that it is something that we should worry about because markets bounce back and there will always be people that will be investing, just be thankful that bitcoin does not collapse, we are focusing too much on the problems that do not involve bitcoin too much.

[el kaka22]

Today, the US stock future goes down near 900 points then the bitcoin prices goes down too.  It happened the same in March 2020 when the US stock market goes down then Bitcoin goes down $4500.  Any one knows the psychology or the mood of the trader?  

It is a good sign in some sense. Because this crypto space is having traders and and investors from Wall street and from other institutional fund managing houses. When a trader see a downfall on stocks they may react on everywhere regardless of the individual potential of different assets. This is just an assumption based on what happened some 3 to 4 years back and what is happening on crypto space against stock's movements.

People do call gold and silver as alternative instruments for stocks but I have seen gold prices are following index of big exchanges. It means when one or two stocks fall and rise that may not impact gold prices but when overall stock market index is fluctuating then gold prices do follows it.

When traders understand the ecosystem of bitcoins like its impacting and influencing factors then they not follow the same trend of stocks; they may switch to bitcoin when stocks not doing good and vice versa. But, when treat bitcoins similar to just another stock/ trading asset then experiencing same fluctuations of stocks may remain inevitable. But, it seems those institutional traders are having complete different approach on gold which must be the reason gold remains unaffected of US stocks.

[pawanjain]

Today, the US stock future goes down near 900 points then the bitcoin prices goes down too.  It happened the same in March 2020 when the US stock market goes down then Bitcoin goes down $4500.  Any one knows the psychology or the mood of the trader?  Thanks.

This might happen at times but this is not the case every time.
Both the markets are independent of each other and it's just the investors perception over the market that makes him to take out the investment from both the markets at the same time. This is not at the case with all people and this is why many times I have seen both the markets going in opposite direction.
Also, you will find very less instances when the US stock market and bitcoin increased together.
Both the markets behave in a different way at different times.

[Dart18]

It does affect the market of bitcoin.

But there is a question here.
How will you know which goes first?
Bitcoin market could go down anytime because of volatility. Will that mean the stock market will do so, afterward?

[coinfinger]

I am also watching bitcoin market is reacting in complete opposite direction of how USA stock markets are doing. Before this, I have observed bitcoin and gold are sailing on same direction most of the time but this time, gold is staying strong but  bitcoin is still remaining range bounded which could be the reason investors are getting panic when the US market is not doing good. Overall we can say they cannot be one permanent trend for bitcoin markets.

In last 6 years gold did not show any big movements but bitcoin approximately gained 10 times growth in that same time frame. So, we cannot say bitcoin is falling into the category of alternative investment like gold. Gold and US stocks are known for reciprocally related but bitcoin is not having anything like that as of now, it seems.  

[Arkann]

One way or another, the cryptocurrency market and the stock market are very dependent on each other, because they are affected by the influence of competition, especially recently, when the cryptocurrency market is increasingly attracting investments, as well as potential participants in the stock market. but this is not the only factor because of which Bitcoin always reacts to the stock market.
and since another crisis is strangling the global economy today, the stock market and the cryptocurrency market also suffer from this. Although, according to experts, the cryptocurrency market copes much better with the consequences of the economic crisis.

[so98nn]

Today, the US stock future goes down near 900 points then the bitcoin prices goes down too.  It happened the same in March 2020 when the US stock market goes down then Bitcoin goes down $4500.  Any one knows the psychology or the mood of the trader?  Thanks.

Nope! Disagree.

The whole US economy is in crisis and so as to poor stock performance, and wait a minute bitcoin stands still 9K+ USD. I believe that is just a wave that occured for few times but it never relies on the stocks. I think we already had such discussion before and it point outs that this is indirect relation so sometimes it affects the crypto severely and other times it doesn't even move it a bit.

My disagreement is to the US stock thingie! I mean bitcoin is decentralised commodity and whole world trades it. It's like you comparing whole US market with rest of the world. That's lame.

[justdimin]

Bitcoin became this corporations commodity thing few years ago. I don't know when it first happened but it wasn't really slowly going up thing, it was a sudden thing. Maybe it was the 2017 December peak when they saw that $20k or maybe some time later or before?

Maybe they were the ones that made it $20k to begin with? I am not really sure but all those wall street type companies (not just wall street as a location but the idea) all got interested in bitcoin and that caused a correlation between stock market and bitcoin. Before that we were independent and different, after that it is all them, when they sell their stocks because of a crash they sell their coins too, when they buy stocks for profit they buy bitcoin too, it became too attached to each other because of them.

[BitcoinTurk]

It does affect the market of bitcoin.

But there is a question here.
How will you know which goes first?
Bitcoin market could go down anytime because of volatility. Will that mean the stock market will do so, afterward?

The price changes we talk about usually take place in almost the same process, so it is difficult to predict which one will take place earlier. Moreover, since the changes we mentioned are instantly following each other, it is not even possible to make an assessment in case of a possible forecast. In general, all we can do is to anticipate bad market conditions and arrange our transactions in accordance with these conditions. However, we can analyze such decline situations in advance and evaluate these opportunities.

[adzino]

Today, the US stock future goes down near 900 points then the bitcoin prices goes down too.  It happened the same in March 2020 when the US stock market goes down then Bitcoin goes down $4500.  Any one knows the psychology or the mood of the trader?  Thanks.

The price hasn't dropped much when compared to the price of stock. Usually people expect the opposite to happen (and I think the opposite thing does happen). When the stock starts to fall, people starts withdrawing their investment and then starts investing on bitcoin causing the price of bitcoin to increase.
This year was a bit exceptional though. The stock and the price of BTC followed, and this was due to people panicking.

[AniviaBtc]

Bitcoin is not apart of the economic system. The only thing is when it does crash those that invested in bitcoin will lose their investment. If the stock market crashes, that usually means unemployment rises, and if you don't have a job, you won't be able to make your payments.  When stock markets crash, investors usually move their money to the Bond Markets until stability returns to the Stock Market.

Agree! All of the markets are affected directly by the economy. Especially in the pandemic, the economy of the world is hardly increasing. Therefore, cryptocurrency market is not an exception, it also decreases! It's not too surprised though!

Proper manipulation of your assets is the key to minimize the effect of crash to your bitcoin. Stock markets are vulnerable every time and their are a lot of factors that can trigger it, including the trading volume. You should know when to invest in bitcoin so that you will not suffer when stock market will go down.

Bitcoin is still a part of economic system as it brings some advantages and disadvantages in the market. Not only stock markets are affected, physical assets and other valuable things are also affected that's why the market depends on the people who actually operate and contribute to the activities in the market.

[coiner-88]

Nothing will happen to the economy because bitcoin is not apart of the economic system. The only thing is when it does crash those that invested in bitcoin will lose their investment. Bitcoin Price Drop to $8.9K Raises Fear of a New Bear Trend Beginning. Traders fear Bitcoin could be entering a new bearish trend after the price dropped below $9,000 earlier today.

[BrewMaster]

You can only call it a "coincidence" when something happens once or twice. BTCUSD and the S&P 500 are nearly identical from mid-February to present. For the last week as the stock market threatened to crash, BTC followed in lockstep, and also recovered in lockstep.

In my opinion it's obvious that if stocks go in the shitter, so will BTC.

it IS a coincidence because it only happened ONCE and never before and never after.
if anything bitcoin is following the pandemic and world economy in general as people lost their income, some lost their job, and a large percentage lost a lot of money. THAT affected everything including stock market, bitcoin market, oil market, gold market,.... bitcoin is still not following stock market.

[South Park]

Bitcoin is not apart of the economic system. The only thing is when it does crash those that invested in bitcoin will lose their investment. If the stock market crashes, that usually means unemployment rises, and if you don't have a job, you won't be able to make your payments.  When stock markets crash, investors usually move their money to the Bond Markets until stability returns to the Stock Market.

I disagree, what do we use to measure the value of a bitcoin? Fiat, right? Which means that bitcoin is part of the economic system whether we like it or not, the truth is that as bitcoin becomes more popular and institutional investors become interested in this market to the point of investing in it then it makes sense for bitcoin to move in a similar way to other markets, after all if the stock market goes down even if this is unrelated to bitcoin the investors that have put their money in both markets will probably sell their bitcoin to cover their losses in the stock market making the price of bitcoin to go down as a result.

[exstasie]

You can only call it a "coincidence" when something happens once or twice. BTCUSD and the S&P 500 are nearly identical from mid-February to present. For the last week as the stock market threatened to crash, BTC followed in lockstep, and also recovered in lockstep.

In my opinion it's obvious that if stocks go in the shitter, so will BTC.

it IS a coincidence because it only happened ONCE and never before and never after.

That is really not true at all.

BTC and stocks correlate well historically. You can confirm this by using an asset correlation calculator. Comparing BTCUSD with SPY or DJI over its 10 year history reveals very strong correlation above 0.8. You can also confirm this visually by overlaying charts.

More importantly, the markets are moving in lockstep now.

if anything bitcoin is following the pandemic and world economy in general as people lost their income, some lost their job, and a large percentage lost a lot of money. THAT affected everything including stock market, bitcoin market, oil market, gold market,.... bitcoin is still not following stock market.

The two are correlated. The point is they are moving together and will likely continue doing so.

[Synaesthesia]

Nothing will happen to the economy because bitcoin is not apart of the economic system. The only thing is when it does crash those that invested in bitcoin will lose their investment. Bitcoin Price Drop to $8.9K Raises Fear of a New Bear Trend Beginning. Traders fear Bitcoin could be entering a new bearish trend after the price dropped below $9,000 earlier today.

Crypto market is a market that is not controlled by anyone, so it will definitely not affect the global economy. I think Bitcoin's decline is often due to panic psychology when reading a piece of bad news about the market. In general, there is no exact comparison between both the stock market and crypto market because each market has its way of operation and different volatility.

[michellee]

If the US stock market goes down, maybe that gives effect to the bitcoin market. I think it provides psychology with an effect on the trader, and they think that the stock market and bitcoin market will be related. So when the US stock market down, the trader will cash out their money while also waiting for another time to buy at a low price. It can give the effect to the bitcoin market, in which traders watch what is going on with the stock market.

[jakkk]

yes that is true. bitcoin follow stocks, but it should not be like that. when stocks falls money should flow into bitcoin

[Kelvinid]

The Crypto market is something correlated to the global stock market. Thus, the US stock market is a huge market player and that it has a big influence on the market trend. Besides, we all dump so hard at this time since we are still facing the pandemic. It probably investors will wait for the market to replenish and they'll turn back to crypto investment well. What they have in their mind today is to combat the crisis and that investing will commence later. It is so much to have a huge impact on Bitcoin's price and see the declining sentiments than driving it high.

yes that is true. bitcoin follow stocks, but it should not be like that. when stocks falls money should flow into bitcoin

That is what we have today. It holds the market to soar high and it takes the level below $10k.