Historical data reveals that Bitcoin (BTC) and the S&P 500 have had a positive correlation of around 0.5 over the past year, meaning that when the S&P 500 increases, BTC tends to do the same.
However, PlanB recently indicated that the S&P 500 had shown a negative correlation with Bitcoin, while Bitcoin continues to rise in price. These periods occurred just before significant bull markets for the king of cryptocurrency, prompting speculation that a similar situation may occur soon.
Breaking my head about this: generally BTC and S&P500 move in tandem (correlated). But sometimes there are short periods where S&P dumps while BTC pumps (4 yellow areas). Usually just before a bull market really takes off. I wonder why and if we will see a similar situation soon? pic.twitter.com/YyYKGUVq2q
— PlanB (@100trillionUSD) March 15, 2023
The cause of this phenomenon is not entirely clear, but it may be attributed to market participants moving away from traditional assets such as the S&P 500 and investing in BTC instead. In times of economic uncertainty, investors may see BTC as a more stable store of value than traditional assets, leading to increased demand and subsequent price increases.
Meanwhile, data from Santiment indicated crypto exchange wallets had received around 50,000 BTC, which is worth an estimated $1.2 billion over the past 96 hours.
The cryptocurrency market has experienced a correction in the last 24 hours, with Bitcoin’s price dropping close to $24,000, after recently crossing the $26,500 mark. The market has been highly volatile, with significant shifts attributed to bank failures, changes in interest rates, and concerns about USDC.
At the time of writing, Bitcoin is trading at $24,201, which is down nearly 7% over the last 24 hours.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.