The DXY

Few indexes are more effected by geopolitics than the US Dollar Index, or DXY. The DXY is a measure of the value of the U.S. Dollar in a relative perspective to six other foreign currencies. It is maintained by Intercontinental Exchange Inc, or ICE. The basket of currencies which currently make up the DXY are listed as follows:

• The Euro (EUR) at 57.6%
• The Yen (JPY) at 13.6%
• The Pound Sterling (GBP) at 11.9%
• The Canadian Dollar (CAD) at 9.1%
• The Swedish Krona (SEK) at 4.2%
• The Swiss Franc (CHF) at 3.6%

The DXY is a solid example of how much the media alone can affect the markets. The DXY often increases on days where there is dollar-positive news and decreases on days where there is dollar-negative news. As an example, The DXY will rise whenever the USD is mentioned on television, in a positive light. In the same way, the DXY will lower in value when dollar-negative news – such as war casualties – are at the forefront of the media.

COVID-19

Anyone who was holding cryptocurrency through the middle of March in 2020 undoubtably felt the financial pain that can come of global events firsthand. Between March 16th and March 17th of 2020 every trading market and asset class suffered a great deal of immediate selling pressure and cryptocurrency got the brunt of it. This was obviously due to the global fear and uncertainty associated with the early stages of the Corona Virus.

The intense amount of selling pressure caused by the beginning of the pandemic also had a latent yet extremely bullish effect on the total cryptocurrency market cap. Although Bitcoin hit a low of $3,000 when the selling pressure was the greatest, the pandemic set the stage for a rally that led to one of Bitcoin’s most significant all-time highs. The staggering number of people receiving government stimulus checks during the lockdown generated a newfound public interest in cryptocurrency. The desire to generate more income, combined with the sheer boredom that came from the lockdown created an interest in cryptocurrency within a new demographic that may have not been so quick to jump in the crypto train otherwise.

Conclusion

The current geopolitical situation that is developing between Russia and Ukraine has already proven to have an impact on the global economy and trading markets. The Russian Ruble has lost a significant amount of its value due to the current conflict. Peer to peer Bitcoin transactions have already become more common in Ukraine, as Bitcoin is less heavily affected by conflict, due to its decentralized nature. As far as what the future holds, we are still unsure. We do know for certain that this conflict will affect crypto, be it in a negative or positive way.

Killer Whale Crypto

CHANGE THE WAY YOU TRADE