Bitcoin edged higher on Tuesday as stock markets cheered the European Union's decision to approve a landmark coronavirus recovery fund.
- The leading cryptocurrency by market value jumped from $9,190 to $9,360 during the 60 minutes to 08:00 UTC.
- Bitcoin is trading at $9,348 at press time – up around 2% on the day, according to CoinDesk’s Bitcoin Price Index.
- European Union leaders clinched the long-awaited €750 billion post-pandemic fiscal stimulus plan during the Asian trading hours, boosting demand for equities and sending EUR/USD to a 4.5-month high of 1.1470.
- Additional bullish pressure looks to be stemming from hopes that coronavirus vaccines would be ready by the year-end.
- Some major European equity indices are up at least 1.5% each, while Germany’s DAX index is currently at its highest level since February.
- Asian stocks also gained over 2% early Tuesday; futures tied to the S&P 500, Wall Street’s benchmark index, are currently up nearly 0.8%.
- Bitcoin has recently developed a strong positive correlation with the stock markets.
- Equities remain vulnerable to a potential escalation in lingering Sino-U.S. tensions.
- Wayne Chen, CEO of Interlapse Technologies, however, said investors may now look to bitcoin as a store of value/safe haven, given the high price of gold.
- The precious metal is now just 4.6% short of the record high of $1,911 reached in September 2011.
- From a technical analysis standpoint, bitcoin’s immediate bias remains neutral, despite today's rise.
- The cryptocurrency is still trapped within the narrowing Bollinger volatility bands.
- A Bollinger breakout in either direction would bring a measured move of $400 to support at $8,600 or resistance at $9,800, as noted by Adrian Zdunczyk, CEO of trading community The BIRB Nest in a blog post.
Disclosure: The author holds no cryptocurrency at the time of writing.
CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk offers all employees above a certain salary threshold, including journalists, stock options in the Bullish group as part of their compensation.