Bitcoin and other cryptocurrencies surged as global stocks plunged in reaction to the coronavirus outbreak in China. A report shows that Bitcoin’s correlation with gold has also turned positive.
The spread of the coronavirus in China has really shaken the world. On Tuesday, January 28, the Chinese authorities said that the coronavirus outbreak has infected over 4000 individuals with over 100 deaths registered.
Moreover, the global markets have already reacted to this alarming situation as we saw global stock plunging on Monday. At this time, Bitcoin and other cryptocurrencies are showing upward movement. The Bitcoin price surged nearly 5% today climbing above $9000 levels.
At press time, the world’s largest cryptocurrency is trading at $8987 with a market cap of $163 billion. Besides Bitcoin, other top ten cryptocurrencies are also showing momentum between 5-10%.
According to the Bloomberg post, Bitcoin is showing behavioral patterns like that of gold. Of course, a single day movement is not enough to make any claims but Bloomberg has interesting observations in place. It states that Bitcoin’s co-relation to gold has flipped positive. The Bloomberg post states:
“Since the beginning of the new year, the two assets 60-day correlation has flipped from negative to positive. The correlation coeffecient now stands at 0.21, up from a low of negative 0.15 in December, and above the trailing one-year daily average”.
The Bitcoin price rally comes as investors dump stocks in favor of other safer assets like the U.S. Treasury bonds, gold, etc. Markets are likely to remain volatile as the coronavirus outbreak continues.
Coronavirus Outbreak Grips the World in Caution
The Wuhan city in China is one of the most infected places with Coronavirus and is on high-alert. Local government authorities have also seized major cities and even canceled New Year’s celebration events across the country.
Furthermore, the U.S. government has released a cautionary note for travelers asking them to “reconsider travel to China due to the novel coronavirus”. On Monday, U.S. President Donald Trump said that his government is in close communication with China. President Trump has also assured further help and assistance in this regard.
We are in very close communication with China concerning the virus. Very few cases reported in USA, but strongly on watch. We have offered China and President Xi any help that is necessary. Our experts are extraordinary!
— Donald J. Trump (@realDonaldTrump) January 27, 2020
Apart from China, multiple Coronavirus cases have been confirmed in other parts of the world like Hong Kong, Macao, Taipei, Thailand, Vietnam, South Korea, Singapore, Malaysia, Japan, Australia, France and the United States.
Well, things look really scary at this point and needless to say one must maintain utmost caution while moving in and out of China at this time.
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