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Bitcoin Awaits Big Bull Run as China Hits U.S. Tariffs Back

In the 24 hours, the bitcoin price has risen by 10 percent and the feelings are switching back to the buying side as tensions are escalating in the global markets.

Monday, the Chinese Ministry of Finance announced it is planning to raise tariffs on US imports worth $60 billion. Beijing said they would raise duty tax on U.S. goods from 10% to 25% as it fought a similar Washington action in the ongoing U.S.-China trade war. The move increased the risk exposure of global investors on the market, with losses posted by nearly all the major futures indexes.

For example,the S&P 500 Futures dropped from 1325 UTC by 1.98 percent to 2,829 points. Simultaneously, after falling 2.06 percent, Dow Futures dropped to 25,428.5 points, while Nasdaq futures plunged 2.45 percent to 7,431 points.

Donald J. Trump @realDonaldTrump

I say openly to President Xi & all of my many friends in China that China will be hurt very badly if you don’t make a deal because companies will be forced to leave China for other countries. Too expensive to buy in  China. You had a great deal, almost completed, & you backed out!

The move increased the risk exposure of global investors on the market, with losses posted by nearly all the major futures indexes. For example, the S&P 500 Futures dropped from 1325 UTC by 1.98 percent to 2,829 points. Simultaneously, after falling 2.06 percent, Dow Futures dropped to 25,428.5 points, while Nasdaq futures plunged 2.45 percent to 7,431 points.

Holger Zschaepitz, the financial editor for the world news service based in Germany, believed that the increasing positive correlation between the trade war and the global stock market would benefit safe haven assets such as gold and bitcoin.

He said ahead of China’s rise in tariffs:

“Global markets start in Risk-Off mode to the week. Stocks fell along with Yuan & Treasury yields amid US-China trade war escalation. Investors awaited details on possible China counter-measures. US 10 year yields drop to 2.44%, Yen and Bitcoin strengthen on haven bids.”

Bitcoin Surge Continues

Today’s bitcoin price has appreciated up to 10% against the US dollar since the open market. The cryptocurrency settled down to $8,000 a lower high, suggesting it may still be within a phase of bearish correction from its peak in 2019.

Alex Krüger, a prominent cryptocurrency analyst, however, said the price of bitcoin is looking to extend its long-term gains.

“Sanity reigned in over BTC overnight, correcting 11% lower,” he stated. “Yesterday’s move above $7000 had started making many, including me, doubt that a strong correction would ensue anytime soon.”

Krüger added that there were no hints of retail-level buying bitcoin, arguing that small investors are too big to back up the size of the appreciation of the asset. Nevertheless, the analyst credited Fidelity Investments, TL Ameritrade, and E*Trade Financial with positive market fundamentals. The U.S. companies either announced or suggested that trading services for bitcoin would be launched.

Gold, Yen Up Too. Monday’s bitcoin price recovery mirrored market biases in haven assets, gold, and the Japanese yen. Today’s spot rate of XAU / USD rose to 1.08 percent to 1299.738, while the JPY / USD rose to 0.64 percent to settle a high intraday to 0.009171.

“The overall reaction by currencies has been limited, however, as there are also factors that support hopes for an eventual settlement, such as the possibility of the US and China presidents meeting at the G20,” Masafumi Yamamoto, chief forex strategist for Mizuho Securities based in Tokyo, said.

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