In March 2020, the traditional stock market dragged Bitcoin and altcoin prices into a deep abyss. However, interest in the Bitcoin and Altcoins has recovered. This is partly due to the rising gold and silver prices. Will precious metal prices continue to rise or will they correct?
Expected decline for silver and gold
Chances are that the crypto market affected is going to be by the gold and silver price. This is because both assets show many similarities. A falling gold and silver price could therefore cause a disastrous Bitcoin crash.
The dollar has fallen sharply recently. The once-all-powerful dollar is in danger of losing its global reserve currency status. This has had a massive effect on the global financial market.
Stocks are currently relatively quiet and have quietly waited for news of stimulus packages to respond. In anticipation of what the next round of stimulus will be, the prices of safe-have assets like gold, silver and Bitcoin have been skyrocketing in recent weeks.
Gold set a new high of over $ 2,000 an ounce. In addition, silver tapped nearly $ 30. Investors are thus moving towards safe assets with uncertainty in the stock market.
However, it seems that the dollar will soon recover. It reached her recently lowest level in two years. But now several technical signs suggest a revival is imminent.
When people take their profits in silver and gold, this can lead to a rising dollar exchange rate and a falling gold price. And if cryptocurrencies such as Bitcoin and altcoins remain correlated with precious metals, the falling of silver and gold could be disastrous for the Bitcoin exchange rate.
Crypto currencies can topple like gold and silver can
When gold set its record, Bitcoin and major altcoins followed suit. BTC broke through the USD 10,000 and rose to USD 12,000 in a flash. In fact, Ethereum is up more than 200% so far and XRP saw a weekly gain of 45%.
In the graph above, we see an uncanny resemblance between all. Because not only Bitcoin, but also altcoins seem to benefit from the success of the precious metals, a falling gold price could pull the entire crypto market down.