SPX500/Bitcoin-Anticyclical-Market-Comparison-Analysis

Hello Traders Investors And Community, welcome to this extremely important fundamental analysis where we will compare the two major assets bitcoin and the S&P 500 Index together, look at the recent months with differences and similarities, the current structural situation and what we can expect from these two key assets in the given sectors. As the corona-breakdowns hit global markets heavily this year and catapulted nearly everything to the south we saw a decent recovery the last weeks which was smaller in some sectors, bigger in other but also even not given or consolidations in others, in this case, we see not only big differences in the single stocks with a high market cap but also in currencies and cryptocurrencies were differences between the individual currencies popping to the surface. What is also an interesting factor when comparing bitcoin and the S&P together is the past history where I detected some nuances and details when comparing these two together which can provide profitable when keeping a diversified lineup in the economy in head and possible profitability of the Anticyclicallity in these major sectors.

As you can examine when looking at my chart is that before the crash this year happened there was a pre-crash-condition you can see marked in grey in the chart which has shown big differences in bitcoin and the index whereas bitcoin provided a weak but steady downtrend with single smaller consolidation periods within it, on the other side the index provided a steady natural uptrend at the all-time-high conditions, such movements can be detected also when looking wider into the history of these two. This pre-crash-movement can support the theory that there is a possible underlying Anticyclicallity given like for example with gold and the stock-market where past has several times shown how gold has risen while the stock-market experienced declines as investors and smart-money buying gold to hedge in the market, such an environment can also be given with bitcoin and stocks as many people calling bitcoin the digital gold this can also serve as such a save heaven in stock market crashes when adaptability increases further as there are voices who also predicted an increase of cryptocurrencies market cap to value of the gold market cap.

Next in the structure, we can take note that bitcoin recovered two weeks faster than the S&P 500 where the index lagged and provided the corona-breakdown-bottom you can see marked in blue within my chart two weeks later since bitcoin already established this bottom. This post-corona-breakdown condition is very important to compare the differences and look at possible moves in the next time. Furthermore, we can watch a consolidation taking place in the two market movers where bitcoin is showing some strength above the 23.6 % Fibonacci-level near the pre-breakdown-condition and the established high before while the S&P still consolidates below the 23.6 % and wide from the pre-breakdown-condition. Therefore we can regard that bitcoin recovered faster since the corona-breakdowns and has moved more to the upside which gives bitcoin a higher bullish edge in comparison to the S&P 500 while both moving in the same direction the amplitude in bitcoin is bigger which can serve in a healthier outcome to the upside when considering a bullish continuation not only because the real economy is still damaged.

Considering the fact that the real economy is still damaged and comparing it to the S&P 500 with a possible bullish breakout this will end in a speculative rally that will increase the areas of tension in the market that can lead to a heavier and exaggerated market crash in the aftermath. Therefore we are at a point in stock-history where it is still possible to increase with bearish pressure to the downside because the crash is not confirmedly over which shows in the big differences and grievances in the real economy and stocks while central banks pumping fresh money in the market the real economy is still damaged from the corona-breakdowns, in this case, we need to keep in mind the possible adaptability of bitcoin and a potential save heaven in the upcoming bear-market-declines which will come sooner or later when this situation goes on enough. Whatever there is waiting on us behind the corner we should be ready for a possible change of direction in trend this means to take all the speculative aspects behind and have a solid lineup in the market to profit of possible upcoming opportunities in a professional and foresighted manner.

Therefore, thanks to everybody for watching, you can support me for more market insights, have a good day, all the best!
The high destiny of the market is to examine rather than to hypothesize.

Information provided is only educational and should not be used to take action in the markets.