Is Bitcoin a store of value correlated with gold or a speculative investment correlated with the stock market? Traders and investors don’t seem to make up their minds, and today’s is a perfect example, as all the other optimistic markets see the vaccine except for the value of Bitcoin.
Earlier today, news of the successful testing of a COVID-19 vaccine by Pfizer Labs set the markets in motion: stocks soared, gold sank and Bitcoin fell more than $1,000 (10%) in a matter of hours. But in the last hour, Bitcoin has recovered most of those losses and is currently trading for about $15,400.
That’s enough for a 0.30% increase in the day.
Vaccine, Elections and Bitcoin
The momentary panic may have been terrible news for speculators and bull traders operating with massive leverage.
But the rebound that the vaccine caused on Bitcoin could be seen as a positive sign for long-term investors, as it potentially sets a limit to how much a brief panic episode can impact the price of Bitcoin at this point.
For those long-term investors, it’s a normal business right now. Bitcoin hasn’t had a downward trend since the coronavirus-induced market crash in mid-March, and news about a possible vaccine seems to have been ignored by Bitcoin traders.
In fact, the market seems to have been much more impacted by the U.S. election; which Democratic candidate and former Vice President Joe Biden has now achieved.
Bitcoin started an even more upward trend over the weekend when the Associated Press and others called for a race for Biden.
The previous trend set Bitcoin’s potential resistance at around $14,766, but instead the price of Bitcoin touched $16,000 per coin before correcting.
Today’s brief drop may help calm down the possible overexcitation of Bitcoin traders over the past week. But with a Biden presidency on the horizon; and an administration bent on delivering more coronavirus relief and economic stimulus, there may be good reasons for Bitcoin holders to be excited.