Is There a Correlation Between The Dow Jones & Cryptocurrency?

Beware of the use of vague terms such as “bull market, bear market” when entering the investment space. The main reason is the incredible “bull market” of 2017, when cryptocurrencies grew more than 10x his. If you had $1,000 invested in Bitcoin at the beginning of 2017, you will have well over $10,000 by the end of the year. I have never experienced anything like this with traditional stock investing. The Dow Jones Industrial Average rose about 23% in 2017.

Be very careful when looking at data and graphs. Because I know that what I want to say can be expressed in numbers. Just as 2017 saw cryptocurrencies rise significantly, 2018 saw a similarly rapid correction. What I'm trying to say is that you have to be objective in your comparisons.

Many newcomers to the cryptocurrency camp are shocked by the recent crash. All they heard was that all of these early adopters got rich and bought lamb. For experienced traders, this market correction is a big deal given the surge in prices over the past two months. It is clear. Many digital currencies have recently turned many people into millionaires overnight

It was clear that sooner or later they wanted to get a piece of that profit.

Another factor to consider is the recently added bitcoin futures trading. Personally, I believe there is a great force at work here, led by old guardians who want to see crypto fail. We also believe the excitement surrounding futures trading and cryptocurrency ETFs is a positive step towards mainstreaming cryptocurrencies and viewing them as “real” investments.

In hindsight, what if there was some kind of connection here?

What if bad news from Wall Street hit cryptocurrency exchanges like Coinbase and Binance? Could they both fall on the same day? Or what if the opposite is true and cryptocurrencies rise as people look for another place to deposit their funds? A period of correction in both markets makes this week that much better, I wanted to wait until

Unlike exchanges, exchanges never close for those new to cryptocurrency trading. I know he has been trading stocks for over 20 years. He sits on a lazy Sunday afternoon and feels so good when he thinks that prices have changed drastically.

This Walmart-like availability can also trigger a kneeling emotional reaction that snows in both directions. In the traditional stock market, people could hit the pause button and make a decision overnight. Rice field.

To get the equivalent of a one-week cycle, we pulled the last 7 days and the last 5 days of cryptocurrency trading data from the DJIA.

Head-to-head comparison of last week (3-3-18 to 3-10-18). The Dow Jones Industrial Average (20 of 30 companies lost) fell 1330 points, down 5.21%.

The Dow Jones Industrial Average does not technically exist in cryptocurrencies, so finding comparisons for the same is a bit different. However, this has changed as many groups have created their own versions.

Currently, the closest comparison uses the top 30 cryptocurrencies by market capitalization.

According to coinmarketcap.com, 20 of the top 30 coins have suffered losses in the last 7 days. Sound familiar? Looking at the entire crypto market, its size has shrunk from $445 billion to $422 billion. Bitcoin, which is considered the equivalent of the gold standard, fell 6.7% over the same period. Usually about altcoins, like Bitcoin.

Coincidence or causation? Why do I get similar results? Are we involved for similar reasons?

What's interesting is that although the price cuts look the same, the reasons are very different. We already said that numbers can be deceiving, so we need to undo the layers.

Top news impacting the Dow include:

Cryptocurrencies are decentralized and cannot be manipulated by interest rates. In the long run, this means that higher interest rates could encourage investors to move their money elsewhere in search of higher returns. Come into play games come

What caused the crypto fix if it wasn't interest?

This is largely due to conflicting news about the impact of each country's stance on the market. People around the world aren't even sure if countries will even allow them as legal investments

There was some positive news before Congress last week from Jay Clayton (SEC Chairman) and Christopher Giancarlo (CFTC Chairman). The bottom line was that we wanted to keep bad actors out and ensure AML laws were upheld while allowing innovation.

Indeed, this similar outcome between the two worlds seems to be due to uncertainty.

We all know markets don't like uncertainty. But uncertainty is fleeting. A problem that haunted you one day can be solved overnight. This news is so devastating that it could paralyze the market for months or even years.

The key is to sift through all this information and decipher what is real and what is not.

I've been watching both equities and cryptocurrencies for a long time, so I find it very rewarding to keep a close eye on both. You have a chance to win almost every day. I would often buy coins that were down 30% the day before and another 30% the next, but within a week they had recovered more.

We recommend diversifying as needed (this depends on individual circumstances). There are days when one is up and the other is down. To boost morale, it's nice to be able to log into accounts that have had a good day. If you have accounts in both worlds, you may be able to link them