SOMEALTEXT

Stock Market Tanks Again While Bitcoin Trends Upward

kingdice"

Despite a rather positive outlook yesterday morning, the Chinese stock market was once again in a slum after a late sell-off frenzy yesterday. Due to a load of investors liquidating various assets, the stock market took another 6% plunge, marking a 14-month low. January has not been a good month for traditional finance so far, whereas Bitcoin has remained fairly stable and even made up some lost ground in the process.

Also read: Bankchains Could Be A Mix of Bitcoin And Ethereum Technology

Chinese Stock Market Keeps Taking Hits

TheMerkle_China Stock Market Down

For anyone who has been following financial headlines over the past three weeks, it has become clear the Chinese stock market is an area that should be avoided at all costs right now. That is unless you are a trader or investor who has assets tied up there, as it might be worth the time to sell off everything before prices plummet even further.

Part of the blame lies with the oil prices dropping even further. Financial experts warned that a drop below US$32 per barrel would be a financial disaster, and so far, that prediction has come true. With prices going down well below the US#27 mark right now, the full scope of such a statement is starting to become clear to investors all over the world. However, the oil price seems to be crawling up to above the US#30 mark again, although that may just be a temporary change.

A late selling frenzy hit the Chinese stock market yesterday, pushing down all of the main indices by 6% or more. Setting a new low for the past 14 months is not how traders and investors had hoped to kick off 2016, but sooner or later, the truth will catch up with all of us. This negative correction has been coming for quite some time, and keeping price afloat artificially can’t continue forever.

When all was said and done, stocks on the Chinese exchange platforms dropped as much as 22% in the past three weeks. With the country’s economy still slowing down and lingering doubts regarding the PBOC’s stance on foreign exchange policies, things aren’t looking all that rosy. It will only be a matter of time until investors pull all of their funds out of these markets, as the current situation is not financially viable.

Bitcoin Makes Up For Lost Ground

TheMerkle_China Stock Market Down Bitcoin Up

The way things stand right now, there is very little inflow of funds into the Chinese stock market, whereas money is flowing out at an accelerated pace. A large group of investors remains confident this ship will turn around, and the Chinese central bank is planning to inject 440 billion yuan into money markets very soon. Where that money is coming from, or if it will help stabilize the markets, is a big mystery right now.

Unlike the Chinese stock market, things have been fairly stable across Bitcoin exchange platforms. In fact, the popular digital currency has managed to regain a small portion of the minor dip it experienced little over a week ago. Investors and traders are keeping the faith in Bitcoin, whereas the stock markets are plummeting to the ground and beyond.

Source: Reuters

Images credit 1,2,3

If you liked this article follow us on Twitter @themerklenews and make sure to subscribe to our newsletter to receive the latest bitcoin and altcoin price analysis and the latest cryptocurrency news.