Bitcoin (BTC) recorded 6.8%between March 5 and March 6, simply recovering $ 92,000. However, the trend was reversed after the S & P 500 decreased 1.3%, and the trend caused the warning of the US economy due to the warning of the President of the Patrick Harker Federal Reserve Bank. Other factors also maintained less than $ 95,000 in Bitcoin, such as uncertainty about Ukrainian tensions and potential US digital asset strategies.
S & P 500 Future (left) vs. bitcoin/USD (right). Source: TradingView / COINTELEGRAPH
Hacker, the Federal President of the Philadelphia, said that the consumer division is increasing evidence that the consumer division is being “stressed.” Harker supported the “pragmatist” approach to the US central bank, adding that the price pressure will continue to be “in this uncertainty environment.” Harker’s opinion suggests support for greater interest rates by the Fed, but does not inform the economy’s strengths.
Merchants increase the location of cash and cash equivalents when they are afraid of economic recession, regardless of whether they are social politics such as conflicts in Ukraine. If Bitcoin breaks more than $ 95,000, the results are high in inflation, so even in the lack of assets are essentially a positive inflation, which requires a decrease in uncertainty.
The war tension and fear of the recession promoted by tariff disputes has raised the S & P 500 volatility index (VIX) to the highest level for 11 weeks. This indicates that investors avoid risks than usual. Historically, under such conditions, Bitcoin was at least not performance right after the local peak in the VIX indicator.
Bitcoin/USD (left, orange) vs. S & P 500 VIX volatility. Source: TradingView / COINTELEGRAPH
At present, the S & P 500 volatility index is now much higher than 16 weeks ago and closer to the highest point for seven months. However, as central banks are forced to stimulate the economy, the result of worsening the economic situation will be a monetary expansion.
On March 6, China suggested more space for fiscal policy in domestic and external uncertainty, and the European Central Bank said that monetary policy is “less limited.”
History repeatedly showed that the increase in money circulation is very advantageous to Bitcoin, which is considered a risk asset or hedge device. Lyn Alden, a macroeconomic analyst, pointed out that Bitcoin is “higher than other major asset classes in the global liquidity direction of 83%of the 12 months of time.”
However, Lyn Alden’s study emphasizes that Bitcoin is not immunized by short -term volatility led by “unique events or internal market mechanics”, as it can be seen as a speculation surrounding the US digital asset strategic protection area. In order to restore the strength of Bitcoin, investors are looking forward to a clear resolution at the upcoming encryption summit organized by the Trump administration.
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For example, Trump’s plan will be negative, for example, by traders, just by stopping the government’s current Bitcoin sales. Although it is clear that Bitcoin purchases depend on Congress’s approval, this provides clarity to Trump’s expectations and plans, allowing investors to re -evaluate potential.
In addition, the positive results of the crypto summit on March 7 can encourage other countries and listed companies to explore Bitcoin as a preliminary asset, allowing potential to open the path of bulls that lasted more than $ 95,000.
This article is for general information purposes and should not be considered legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.