Bitcoins online sentiment is facing a decline for the past two years and the analytics also state that it is possible that Bitcoin would break out very soon.
The world economy is not in a good progressive position especially the countries like the United Kingdom, France, and Spain are now imposing altered restrictions across their borders. Their actions would eventually make the future financial prospects of the local business owners even.dark.
Bitcoin value dropped in September 2020
According to the news from crypto-economy for September 21 Bitcoin passed through a drop of nearly 6.5 % to the $10300 mark after enjoying a good position of around $11000 for a few weeks onwards. The interesting thing to know about all this scenario is that the flagship crypto also jumped in value at the same time as gold and the S&P 500.
From the technical point of view, an overview of the volatility index clearly presents that the volatility of the S&P 500 during that particular period of time increased to a great extent rising above the $30.00 mark for the first time in a period of more than 2 months. It also led many critics to think that it is just like another crash that we have seen in March 2020.
What is the myth behind the digit $30?
It is also to be noticed that the $30 mark is regarded as an upper limit to show the shocking events to indicate the world shocking events such as Wars or terrorist attacks. However, in other time periods of regular market activity, this indicator stays put around $20.
Talking about gold which is a precious metal, has also faced a huge loss during the last two months. This is the same case with silver which also experienced a significant price drop in 9 years. The declining interest in gold investment has made the critics believe that the traders are now again planning to turn towards the US dollar using it as a financial asset. They can do so as the dollar index has been successful to maintain a strong position and as compared to other premiere currencies like Japanese yen, Swiss Franc, and Euro.
There is something more than meets the eye
We all know that crypto, gold, and S&P 500 markets have been in a good correlation in the price action. The critic of Joel Edgerton who is the chief operating officer of crypto exchange Bitflyer has made this point clear in a conversation with Cointelegraph that if we compare crypto with other assets like gold, silver, stock options, etc, we have seen that crypto has shown more volatility than the aforementioned assets.
He specifically pointed out that the pair BTC / USD is regarded as a sensitive pair to the movements of the US dollar. It is also a central point of any discussion related to the Federal Reserve's potential strategy. To learn more about the link of US dollar and bitcoin visit bitcoin profit.
Bitcoin bounce back
Recently we have seen that Bitcoin stopped at a price point of around $10,300 which led the currencies social media sentiment slumping to a 24 month low. But to our surprise, we see that according to the data launched by crypto analytics form Santiment BTC is still experiencing a big surge, whenever there is an online sentiment around.
It is a coin which is hovering in FUD, fear, uncertainty, and doubt. The firm also stated that this trend of negative online sentiment became visible since the start of September and this is not only relevant to Bitcoin but also to Ether(ETH) and to other digital currency.
Online Sentiments for Cryptocurrencies
In the world of cryptocurrency, the online sentiment of cryptocurrency is normally measured by gathering social media data set. These data sets are associated with the coin in question. Afterward, this kind of information is processed by using various machine learning protocols in order to sort the data whether it is positive or negative. Some of the other analytics providers also use a metric called 'market value to realized value' or MBR. It is actually a calculation of the average profit and loss of different holders to ascertain whether a coin is facing a rise or a fall.
The recent plunge of Bitcoin was nothing special
The simultaneous plans in the value of gold, crypto, and stock are regarded neither as a coincidence nor any technical abnormality. It is quite normal to observe these steps across various markets during this time of high uncertainty.
We can understand it with an example that during the last few months a huge number of investors around the world have predicted the risks related to their current portfolios. These traders also initiated to liquidate some of the most volatile assets. These are the assets that most of the time are cryptocurrencies and equities. Taber a critic also noted that this kind of branch is a normal part of volatile markets and we have also observed similar scenarios back in 2008.
