Global Stocks Won’t Make Traders FazeDavid Kemp
Recent data suggests that all the latest events occurring in the crypto market can significantly change the usual flow of things. Numerous events that the entire crypto community has been facing are of great importance to many participants.
Both traders and miners keep track of what may happen next and professionals are trying to predict what direction cryptocurrencies may take in the nearest few months. According to many crypto specialists, all those who are dealing with Bitcoin do not seem to be fazed even though the global stock market is about to enter the so-called ‘bubble’ territory.
What users are now discussing on many forums has been taken from the top leading mass media outlets as well as trustworthy sources such as the Buffett Indicator.
We cannot deny the fact that many of us refer to the indicator whenever we need to obtain more detailed information. This time the source illustrates that the global stock market is likely to have entered a ‘bubble’ zone and several prominent market analysts pay attention to this factor.
Some of the participants cannot ignore the recent correlation between the top-ranked cryptocurrency and stocks. This data may mean that the asset is also at high risk of a possible pullback.
Additional Data for Further Studies
The chart below shows a more detailed image of the current situation. By studying the information, one can draw certain conclusions and parallels. More thorough research can always be beneficial and quite rewarding since additional data will be of great use to those individuals who look ahead and strive to achieve greater results.
Crypto analysts remind us that stocks have been steadily rallying in the past few weeks. They, at the same time, buoyed by the surging greater appetite for assets that the crypto market considers risk-on.
In the past four weeks, the DJIA has managed to rise from twenty-five thousand seven hundred and six points to twenty-seven thousand four hundred and thirty-three, by a bit less than seven percent. Traders may be wondering why stocks are demonstrating hints of a certain bubble. They also question how it could possibly impact or affect the cryptocurrency.
Again, the indicator is a tool for measuring the stock market’s valuation. It divides the market cap by the country’s GDP and then attempts to detect a suitable valuation of stocks that are relevant to the U.S. economy. When the figures are above one hundred, it indicates that the market is moving toward the ‘bubble’ zone.
For the past four months, after the lockdown period started, the country’s stocks surged because there were quite good conditions. Besides, the government was ready to deliver a multi-trillion dollar stimulus package. Indeed, tech stocks happened to have outperformed the rest and pushed the very market upward. Crypto analysts cannot deny the fact that there were plenty of macro factors that influenced the valuations and impacted earnings.
As a result, global markets went into a ‘bubble’ territory. The event was widelydiscussed and analyzed by crypto specialists and traders. Another milestone appears to have been hit. All stocks may currently be worth over one hundred percent of global GDP in the past two years. One the other hand, it points out to stretched valuations.
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