BitcoinBONDeconomic stimulusMarketsStocksyield curve

Bitcoin, Gold, Stocks Rebound With Drop in U.S. Dollar

Bitcoin and technology stocks rallied this week, recouping from losses due to rising bond rates. Along with changes in the bond and gold markets and new upcoming stimulus rounds, there are five important macroeconomic movements affecting Bitcoin.
The Bond Market
On a global macro-level, Bitcoin’s positive outlook began with the “reflation trade” in bond markets. 
The market can track the reflation trade using the yield curve indicator, which measures the difference between long-term bond yields and short-term contracts. A steeper yield curve indicates the market’s expectations of high inflation in the future.
The bond market’s ten-year-yield has tripled from a low of 0.52% in August. Additionally, short-term expectations are still low due to the prevalent effects of COVID-19 shock. Hence, rising yields have threatened to move value away from other assets.
U.S. bond market yield curve. Source: StatistaThe U.S. Stimulus and Inflation
In the United States, the Biden administration is days away from ratifying a third economic stimulus package of $1.9 trillion. The government passed $3.4 trillion worth of stimulus packages in 2020. 
The new stimulus round is likely to spark inflationary fears. However, the U.S. dollar has been in an uptrend thanks to the rising yields of long-term bonds. The dollar index (DXY) against other fiat currencies broke above the $90.50 resistance to a high of $92.50. 
U.S. dollar index (DXY) price chart. Source: Trading ViewHowever, DXY corrected this morning by 0.28% after bond market sell-offs slowed down. Liquidity is now flowing out from the dollar again, which has …
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