Investments in any type of asset, including the price of Bitcoin Trader, are influenced by an enormous multitude of factors, and probably the most important are the macroeconomic indicators, attached to the economic calendar.
Among these indicators we find such important results as GDP growth, the variation of non-farm payrolls, or interest rate decisions
This calendar also includes other important events, mainly of a geopolitical nature, such as press conferences offered by governors, main summits and conferences, elections; as well as the announcement of the different relevant holidays that usually reduce monetary activity.
Influence of the economic calendar on the markets
This calendar is most often used by currency and derivative traders. This is because macroeconomic indicators, being a data that shows the health of a country, directly influences the price of different fiat currencies.
However, they are not the only ones who use them; even other assets such as stocks, bonds, indices, gold, oil or the price of Bitcoin itself, are affected by geopolitical events and macroeconomic data.
In the financial markets everything is connected, and the main vehicle for trading in them is fiat money.
Generally we see gold, silver, or oil sold in dollars; therefore a strong fluctuation of this currency, will affect your position against assets such as those named.
But it’s not just the connection. Commodity prices are affected by indicators such as the unemployment rate, consumption, or interest rates.
The release of new building permits in the U.S. may boost the S&P 500 sharply, as it is an index that tracks the growth of the U.S. economy. The same could happen with the DAX in Germany, or the NIKKEI 225 in Japan.
When interest rates vary, government bonds are one of the main assets to be affected. If the central bank decides to rise, bond prices can fall, and the opposite is also true.
Bitcoin will be interesting again
How does the economic calendar influence the price of Bitcoin?
Just as the share price is mainly affected by announcements regarding the growth or slowdown of the company, crypto currencies in general are largely driven by fairly direct factors, such as developments in the code and increased adoption.
However, this does not mean that they are totally unrelated to other markets. For example, interest rates may currently be a major influence on the price of Bitcoin.
Immediately, a country’s currency is affected when interest rates vary. When a rate is low, the currency of the country where it was adjusted increases its price; and consequently it is stronger against different assets.
Interest rates are low when you want to encourage consumption, and although it is usually a rescue measure, in the long term it usually triggers inflation.