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Michael Novogratz: the situation on Wall Street influenced Bitcoin

Tuesday, 03 March 2020

Well-known cryptocurrency enthusiast Michael Novogratz was surprised to find that over the past week, stock market and Bitcoin rates have fallen simultaneously.

Usually, analysts say that the rate of the first cryptocurrency does not correlate with any other asset, but last week showed the opposite. It became one of the worst for Wall Street, and indeed the global economy as a whole - the stock indices of developed countries fell together amicably, and Bitcoin along with them.

"How did $btc go from being a hedge against bad stuff to getting washed out and trading like a risk asset? When things go from bad, to very very bad like they did last week, investors take leverage down as fast as they can. They book profits to make up for other losses. Ouch,"
wrote Novogratz on Twitter.

How did $btc go from being a hedge against bad stuff to getting washed out and trading like a risk asset? When things go from bad, to very very bad like they did last week, investors take leverage down as fast as they can. They book profits to make up for other losses. Ouch.
— Michael Novogratz (@novogratz) March 1, 2020

Thus, according to Novogratz, those traders who lost in the stock market began to shorten Bitcoin in an attempt to catch up. Recall that Bitcoin declined for two consecutive weeks and lost about 15% of the value. Currently, the first cryptocurrency is trading at $ 8,600.

At the end of last year, Novogratz announced that in 2020 the Bitcoin rate would reach at least $ 12,000. Given that in the first months of this year the first cryptocurrency was trading at $ 10,500, the prediction of the cryptocurrency enthusiast looks very plausible.