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Global markets went on a roller-coaster ride this week following news that President Donald Trump had contracted the Coronavirus. Crypto markets, equities, and metals all dropped initially on the political uncertainty but recovered as details about the president’s recovery began to emerge.
However, when Trump returned to work, he announced via his Twitter (TWTR) feed that he would be ending talks with the Democratic Party over further economic stimulus. The markets, which have been heavily reliant on stimulus due to the partial economic shutdown caused by the Covid-19 pandemic, tanked. Finally, markets rebounded strongly when Trump explained he was open to more focused stimulus measures such as $1200 checks for each American family, and further support measures for the aviation industry.
The major cryptocurrencies Ethereum (ETH) and Bitcoin (BTC) followed the direction of other major markets for most of the week until a shot of good news. Square (SQ), a point-of-sale software and payments company, announced the allocation of 1% of total assets, or $50 million would be allocated toward an investment in Bitcoin (BTC). The positive industry news comes after another public company, MicroStrategy (MSTR) invested $250 million in BTC a few months ago as a hedge on inflation.
Into next week, investors will see how prices digest the investment news. Large public companies becoming investors in crypto markets can provide validity to a space that was once looked at as obscure and unsafe. As of now, the picture in crypto seems rosy after markets were able to shake off the negative news that the KuCoin exchange was hacked last week.
As far as known events that will potentially affect crypto markets, the most obvious are the upcoming U.S presidential election as well as the ongoing talks for further stimulus.
Though some short-term volatility was evident in cryptocurrencies early in the week, the bull market remains intact. The weekly charts of Ethereum (ETH) and Bitcoin (BTC) show strong uptrends over the last few months followed by a uniform pullback in recent weeks. Technicians often turn to weekly charts to get a feel for the overall trend and smooth out the data. For the time being, bulls remain in control.
-World Blockchain Summit Dubai will be held online (10/14)
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