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Dow Blasts Higher While Bitcoin Endures Painstaking Search for a Bottom

Dow Blasts Higher While Bitcoin Endures Painstaking Search for a Bottom

dow jones bitcoin

The Dow continued to soar on Tuesday morning, but things weren’t quite so bullish for the bitcoin price. | Source: Shutterstock

A defiant US stock market opened to significant gains on Tuesday, brushing off bearish portents about declining corporate earnings. Bitcoin, meanwhile, continues to endure a painstaking search for a bottom as it seeks to bring its longest-ever bear market to a definitive close.

Defiant Dow Extends Early-Week Rally

Shortly after Tuesday’s opening bell, the Dow Jones Industrial Average had gained 99.61 points or 0.39 percent. The S&P 500 and Nasdaq also extended their gains, rising 0.24 percent and 0.41 percent, respectively.

dow jones nasdaq s&P 500

The Dow (blue), S&P 500 (red), and Nasdaq (orange) have all climbed significantly over the past five trading sessions. | Source: Shutterstock

On Monday, the Dow clawed back from an early-morning decline to mount a more than 175 point or 0.7 percent rally, closing the day at 25,239.37. The Nasdaq climbed by 1.15 percent and the S&P 500 added 0.68 percent as stocks flashed green across the board.

The Patriots Win Again [and so Does the Dow]

patriots won super bowl dow jones

Source: CCN

That single-day rally confirmed a surprising correlation between the stock market and the New England Patriots’ performance in Super Bowls throughout their 21st-century dynasty. While the Dow has declined on the Monday following each of the Patriots’ three Super Bowl losses, it has only ended the day in the red once following their six championship game victories. While correlation doesn’t equal causation, the trend is hard to ignore.

Trump & Powell Break Bread

donald trump federal reserve jerome powell stock market dow jones

Donald Trump and Jerome Powell met at an “informal dinner” on Monday. Did it help the two men settle their differences? | Source: REUTERS / Carlos Barria / File Photo / File Photo

Also bolstering the stock market was a report that Federal Reserve Chairman Jerome Powell sat down to an “informal dinner” to discuss the state of the economy. Trump had been harshly critical of Powell and the Fed for raising interest rates, blaming the independently-run central bank for throwing a wrench into the market’s historic bull run.

It’s unclear whether the stock market pullback or Trump’s one-sided war of words played a larger role in spooking Powell and the Fed, but the bank has lately curtailed plans to continue raising rates, a policy shift that has fueled the early-year recovery of the Dow and its peers.

Bitcoin Price Trades in Tight Window

bitcoin price

Source: Shutterstock

On the cryptocurrency front, most large-cap assets continue to range-trade within a tight window while analysts spar over whether the bitcoin price has found a bottom or stands to take further losses ahead.

On his part, Alec Ziupsnys, a cryptocurrency analyst and the founder of Rhythm Technologies, said that he believes bitcoin may have moved into the final stage of the bear market cycle.

“The capitulation phase completed once we dropped another 50% past everyone’s “price floor” from $6,000 to $3,000,” he wrote on Twitter.

Bitcoin may be well be past capitulation in the market cycle.

The capitulation phase completed once we dropped another 50% past everyone’s “price floor” from $6,000 to $3,000.

‘Bull markets are born on pessimism, grow on skepticism, mature on optimism, and die on euphoria.’

— Alec Ziupsnys (@AlecZiupsnys) February 5, 2019

If bitcoin has moved past capitulation and into despair, then that means the market is close to turning a corner. Following the conclusion of the “despair” phase, the bitcoin price should return to a mean of around $6,400, according to Ziupsnys’ analysis.

In the near-term, the cryptocurrency market is likely to suffer from reduced trading volume during the Chinese New Year celebration, according to crypto brokerage BitOoda. Writing in a note to clients, the firm said that “business slows down substantially leading up to and following the week-long holiday – very comparable to the week between Christmas and New Years in the West. It will be interesting to see if volumes pick up in the coming weeks[.]”

bitcoin price

The bitcoin price continues to trade in a tight window.

As of the time of writing, bitcoin was priced at $3,429 on Bitstamp, just $5 below its intraday high of $3,434. BTC/USD has traded in a tight $38 window all morning, and several analysts expect it to see a breakout in the near future. The question is, which way will it break?

Altcoin prices held relatively stable throughout the 24-hour period. Only two large-cap cryptocurrencies — stellar and bitcoin sv — moved more than 1 percent, with both of them tilting to the downside. Altogether, the cryptocurrency market added approximately $150 million over the previous day, bringing it to a present value of $113.7 billion.

Featured Image from Shutterstock. Price Charts from TradingView.

About The Author

Josiah Wilmoth

Josiah is an assistant editor at CCN. In a past life, he taught Herodotus and Boethius to high school students. He holds long-term investment positions in bitcoin and other large-cap cryptocurrencies. Follow him on Twitter @Y3llowb1ackbird or email him directly at josiah.wilmoth(at)

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