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World Economies & Crypto Market Crash: Is Coronavirus Only to Blame?

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What is really happening to the worldwide investment market as the stocks and major indices like S&P 500, Dow Jones Industrial Average Index and NASDAQ future plunge record nearly 5% and 1200-point low, respectively. Not only this, but the wicket of crude oil dip has gained an additional point for the opposite team–the novel Coronavirus.

Coronavirus Spreads Rapidly Across Countries; Traps the Major Economies

With the growing number of cases all over the world, Coronavirus has been actively present in all the segments leading to fears of an all-out price war.

Looking at the below stats, we will see how the leading investment avenues have led the investors to experience a free fall and loose enormously overnight.

Oil prices have slashed by 30% after the Saudi Arabia decided to reduce its selling price and ramp up the production due to decrease in demand because of Coronavirus outbreak. As know, this happens to be the massive drop in 29 years as COVID’19 turns out to be positive for majority of the suspects in the US, Europe and Northern Italy quarantined.

Dow Jones futures plunged 5.05%, S&P futures dipped by 5.1%, and NASDAQ 100 futures sold off 5.1% and are also subject to further trims if continued to trade freely. Well, the futures have been exhibiting a strong sell-off as the Friday’s trading session in the previous week tuned out to be quite chaotic.

However, just when the worldwide stock markets were breaking out heavily and the investors were losing billions in seconds, crypto market rose above its sluggish movement and Bitcoin breached $9k. It happened to be the only avenue which was seen rising just to fall in the line of other avenues when it recorded the lowest at $8.1k yesterday, while currently dips deeper as it slides below $8k.

Crypto market breakdown came as a shock after 2 days of mitigate trading which now looks like it gave false hopes as the worldwide investment markets crash.

As per CEO of Binance, these intermittent rises cannot be confused with a Bull Run, rather these are just elementary reorientations in the market.

Although, crypto has also attained a benchmark breakthrough when it made an entry in the Indian market as the 2018 crypto ban unleashed by the SC. Unfortunately, Coronavirus is just acing the space of getting the popularity and outnumbers the amount of search compared to Bitcoin and Cryptocurrency. And, with this the crypto market shed over $21 billion in just one day and the premier cryptocurrency–Bitcoin recorded an intraday dip of over 8%. Not only did Bitcoin but the major altcoins viz., Ethereum and XRP are also trading in red against the US Dollar.

Looking into the charts and price movement of market’s top three cryptocurrencies, we see a gradual decline and intraday bearish crossover as the coins loose heavily.

Price Analysis: Bitcoin, Ethereum and XRP

Bitcoin (BTC) Price News

Taking a glance at the price movement of Bitcoin against US Dollar in the duration when the markets worldwide were losing their significant worth, we see a steep intraday fall as BTC slid below $8k. The price trend of Bitcoin is also exhibiting significant lows and has gradually lost support from the 50-day and 200-day daily moving average. From ranging around $9.2k on March 07, BTC is currently testing supports below $8k as it plummets by over 13% in 2 days. The pullback is quite eminent to realize that we do not see a recovery any soon as the stock market also crashes.

The major question that lies here is:

Is the Indian Market and potential crypto lovers within doing no good to boost the instigation of cryptocurrency in the nation?

Ethereum (ETH) Price News

The premier altcoin after Bitcoin is Ethereum and has been no exception as it dipped below $200 just today and the selling pressure ramps up. With no exception on the board, ETH price against US Dollar dips over 21% from trading at a height of $250 to bottoming out at $196.07 today, while at the time of writing it was trading at $204.03. Similarly, Ethereum has lost support from the imminent moving averages i.e., 50-day and 200-day as it strikes the market pressure.

Ripple (XRP) Price News

XRP, ranked 3rd in the global crypto market is also seen declining along with the above two as it falls to $0.2007 from the high of $0.2450. Alongside, it has also left the support from the daily moving averages as the market crashed overnight. Not only the price but the related variables like market cap and trading volume have also manifested the frequent dips as the investors slash.

However, can we really burden the novel Coronavirus with the sudden dip of the economies around the world. Is it the only reason for the markets to dig deeper? This creates an ambiguity between Coronavirus being dreadful to human life or human pockets.

Here, I would like to align my answer to what Peter Schiff has tweeted recently.

Just because the worldwide known incident happens to be the COVID’19, we can’t really give a baseless conclusion. As he has rightly pointed out, it is not the virus but the debt that’s floating in the economy and eventually piling up. Because, to conclude, there will be many such viruses coming over in future but is the financial investment system and financial backup of the sectors so weak that it is unable to cater with the same.

Mehak Punjabi

Mehak Punjabi is a post graduate in MBA with specialization in Finance and has joined CryptonewsZ with a skill building view in the world of cryptocurrency and blockchain. She is dynamic and a quick learner with a hold on financial analysis.
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