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Why Trump would be the Bitcoin Volatility driver in 2017


2017 saw Donald J Trump take the office as the new President of United States of America. Right from the moment trump took to office, the global markets were facing uncertainty which lead to price fluctuations over speculation. Economists around the world predicted that Trump’s election might crash the markets. After taking to office, Trump has come out with policies that surely impacted the markets in ways more than one expected. President Trump has been delivering on his promises and has been resilient in sticking to his policies. While the global markets are certainly impacted by the policies, let’s look into how Bitcoin will be affected:

Trump’s initial firm steps:

When Trump announced the Visa ban for seven small economies, things didn’t seem so bad for the markets. The commotion that followed the decision, where major tech giants have joined forces to fight the policy has created uncertainty in the market. This lead to rise in Bitcoin prices during the period as a hedging measure by major market players. Later, Trump suffered a major set back in the appeals court on his immigration ban. The Bitcoin markets have turned a blind eye to this decision showing Trump’s credibility to affect the markets with policies whereas Trump’s setbacks weren’t that important. This only means Bitcoin markets would thrive on the uncertainty created by Trump’s surprise policies.

How Trump’s next steps would be impacting Bitcoin:

President Trump promised phenomenal tax plans last week which prompted for trades going long on dollar and US equities and short on Treasuries. Added to that Trump’s meeting with Japan’s Prime Minister Abe is set to have a short term bullish effect on Dollar-Yen Trading pair. Abe is bringing loads of investment promises which Trump is sure to promote heavily. If Trump does it, without thinking of currency manipulation, then USD/JPY can have a decent spike higher.

Nevertheless any shortcoming on his tax plan promises or mentions of currency manipulation with Japan would see a lot of turmoil in the market and hedging in Bitcoin. This would lead to increased volatility in Bitcoin prices. The first year of Trump’s administration with policies inflicting too much volatility in global markets would inturn make Bitcoin markets volatile.

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