This week’s price volatility for bitcoin (BTC), gold and our stock pick, the S&P 500.
B T c
After a promising start in February, Bitcoin has been on a downtrend for two weeks. On February 10, bitcoin was trading around $45,000. By February 12 it had fallen to $42,000, where it remained until February 15 when it rose to $44,000. By February 17th, BTC started declining again, reaching the $40,000 support level the next day. However, by February 20 it had failed and by February BTC had fallen to $38,000 and then to $37,000. BTC has declined and is currently trading above $36,000 despite a push back to $39,000 over the past day.
The overall cryptocurrency market capitalization fell by more than 9% in the past 24 hours as Russia launched military action in Ukraine. Nearly $200 billion in digital assets were liquidated during the initial 12 hours following the start of the attack, resulting in a massive market collapse, bringing the total market capitalization to a seven-month low. At press time, according to CoinGecko, the total market cap was approximately $1.648 trillion, the lowest level since early August 2021.
Sleep
Apart from performing well in February, gold as a safe haven asset during market turmoil due to aggression also saw a rise. The price of gold was $1,830 on February 10, which rose to $1,860 the next day. By February 15, it rose to $1,880 and then declined slightly to $1,850. From there it started rising again, hitting resistance at $1,900. Holding this level till the previous day, gold climbed above $1,970 to return to $1,925 where it is currently trading.
Investors turned to safe-haven assets in the wake of Russia’s invasion of Ukraine, as gold hit nearly 18-month highs. Russia on Thursday launched an all-out invasion of Ukraine by land, air and sea, confirming the West’s worst fears, the biggest attack by one state against another in Europe since World War II. “There is safe-haven demand for gold … This crisis is very inflationary because it is putting upward pressure on commodity prices,” said Saxo Bank analyst Ole Hansen.
SP
Despite the overall poor performance in February, the S&P 500’s recent decline reflected the overall reaction of US markets to the conflict in Eastern Europe. The SP started trading at $4,525 in February, rising to $4,595 the next day. The SP fell from there, trading between $4,525 and $4,450 as of February 9. From there it dropped back to $4,575, reaching below $4,400 by February 14 until it began to decline again the next day. The next day the S&P reached $4,450 again, but by February 17th started to decline again. It is currently trading just below $4,200.
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