This is a follow-up to my post a week ago.

Much has changed since then, including my short-term predictions. Let's have a look at what I now think, and more importantly, why I think that way.

Crypto Markets March 2018 - up or down?

My previous post ( https://steemit.com/bitcoin/@bitbrain/crypto-markets-march-2018-up-or-down ) was rather bullish, both short and long term. However, the market stagnated the last few days, and has now taken another dip.

But why?

There hasn't been much FUD lately. In fact: crypto news has been remarkably positive for the last few weeks. Every since the G20 summit things have been getting better and better, yet crypto remains low in USD terms, taking two steps forwards but then three steps backwards.

Because the stock markets are dropping - fast.

[Google it - here is one example - https://www.moneyweb.co.za/news-fast-news/stocks-tumble-in-biggest-weekly-decline-since-2016/]

I believe that the exact nature of the relationship between traditional stock markets and crypto markets is in a state of flux. Until now they have been linked, but until now there was very little trust in crypto as an investment asset.

So when times were good and people were making money, they had a little spare to invest in crypto, but not as a serious investment.

But that is changing. Fast. Crypto is fast becoming a serious player in global finance. It is a force that can no longer be ignored. Institutional money is increasingly finding its way into crypto markets and more and more portfolios are featuring crypto assets in them. Crypto is no longer just the realm of pioneer investors, it is finally becoming mainstream.

Right now the stock markets are not doing well. They are dropping. And because of this, people do not have that bit of extra money to speculate on crypto assets. Thus the crypto markets suffer.

Tell me if you've seen this chart before:

From www.google.com

It's the crypto total market cap chart for the last 12 months. The steady rise, the January peak, the big fall and the most recent dip.

Only it isn't a crypto chart at all. I lied; that is the Dow Jones chart. But look how remarkably close it appears to this chart:

From www.coinmarketcap.com

The second chart really is the crypto total market cap chart for the last 12 months. The similarities are plain to see. To make it even clearer, here is a composite image that I have compiled using the previous two images:

What does that mean for us?

It means that crypto is linked to the stock markets. I have found that it seems to be most closely linked to the Dow Jones Index, but the statement is true for most markets to a greater or lesser degree. Indeed most markets are themselves linked to the Dow Jones Index. When America sneezes, the world catches a cold.

So when the Dow Jones does well - crypto does well. When the Dow Jones suffers - crypto suffers.

But I don't believe that it will stay this way. Stock markets have generally been bullish for several years now, they may well now be turning bearish. It is highly unlikely that the investors in these markets will convert their money into fiat and just leave it there. The big money in these markets is too big to just allow it to stagnate. These investors will look for other opportunites. (This isn't crypto, a hodl strategy in a bearish stock market is out of the question.) Crypto IS growing, and blockchain tech IS the way of the future.

I consider it to be extremely likely that even more institutional money will start to find its way into crypto at an accelerating rate. This means that crypto total market cap will start to break away from traditional stock market indices; indeed, it may eventually even become the inverse thereof.

Summary

• Crypto is dropping again because the stock markets are dropping hard.
• Crypto follows the stock markets and will continue to do so in the short to medium term.
• Crypto will break away from the stock markets and will rise when then fall in future (in the medium to long term) {my intuition based opinion}.
• Crypto may now fly up now like I expected it to, but it will certainly go up sooner rather than later. I'm holding and buying.

So there you have it. My latest take on the marco market. I hope it helps, I hope I'm right. As always, DYOR. Hope you all make lots of money.

Yours in crypto,
Bit Brain

DISCLAIMER:

I am not a financial advisor nor am I a professional trader/investor. This is not financial advice, investment advice or trading advice. Unless otherwise stated, all my posts are my opinion and nothing more. Crypto is highly volatile and you can easily lose everything in crypto. You invest at your own risk! Information I post may be erroneous or construed as being misleading. I will not be held responsible for anything which is incorrect, missing, out-of-date or fabricated. Any information you use is done so at your own risk. Always Do Your Own Research (DYOR) and realise that you and you alone are responsible for your crypto portfolio and whatever happens to it.