According to TradingView data, the correlation between bitcoin and the S&P 500 can reach 0.9 when bitcoin falls below $45,000.
As the S&P 500 ended the first quarter down 5.5 percent, bitcoin (BTC) followed suit, with the world’s largest digital asset remaining inextricably linked to the S&P 500.
Bitcoin ended the quarter down 2%, bringing the correlation to approximately 0.9 with the S&P. (1 is perfect correlation, -1 is perfectly inverted).
While bitcoin reached a high of $48,000 earlier this week, it has since fallen below $45,000 to end the week.
The association between the index and bitcoin looks to be cyclical; given bitcoin’s 24/7 nature, its losses will surpass those of the stock market.
Similarly, its rapid recovery will exceed the S&P.
Traders are anxious about the length of the Russia-Ukraine conflict and the Kremlin’s threats to shut off Europe’s natural gas supply unless contracts are denominated in Rubles.
Although bitcoin had one of the worst starts to a year on record, it ended March up approximately 9%, occasionally exceeding US markets.
Numerous layer-1 tokens, however, such as Solana, Terra, AVAX, and Cardano, were able to exceed bitcoin with double-digit gains because to widespread excitement over the upcoming Ethereum 2.0 launch.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.
