Data shows that the correlation between Bitcoin and S&P 500 has recently fallen to zero, a sign that BTC is no longer attached to the stock market.
Bitcoin correlation with S&P 500 has recently witnessed a dive
In a new one after On X, the Market Intelligence Platform IntotheBlock discussed the trend in the correlation between Bitcoin and S&P 500. The “correlation” here refers to an indicator of how the prices of two given assets are tied together.
When the value of this metric is positive, it means that the price of one of the assets responds to movements in the others by traveling in the same direction. The closer to the indicator is for 1, the stronger this relationship is.
On the other hand, the metriek implies under the baseline marking that although there is also some correlation between the assets in this case, it is negative. This suggests that the graphs move to each other in the opposite direction. For this zone, the extreme point -1 is corresponding to the tightest relationship.
Now here is the graph for the correlation that is shared by the analysis company, which shows the trend in the value of the metric for Bitcoin and S&P 500 in recent months:
As shown in the graph above, the correlation between Bitcoin and S&P 500 rose close to 1 Mark in January, which means that the prices of the two showed a strong positive relationship.
However, since the peak at the beginning of this month, the indicator has observed a sharp downward route and its value has come to exactly zero today. Such a value means that there is no correlation between the assets. The statistics say that the variables in this scenario are independent.
The correlation can be a useful indicator to pay attention when an investor wants to diversify his participations. Assets that have a close relationship may not be worth investing at the same time, but those who have a low value of the metric can provide smart diversification options. As it is currently, the S&P 500 could offer something different to Bitcoin investors and vice versa.
“The last time we saw that a low correlation was on November 5, 2024, just before Bitcoin sought past the 100k marking,” notes Intothlock. Now that BTC is again free from the stock market, it is possible that the cryptocurrency can also show a big step this time. However, it can only be seen how long the coin can stay away from the influence of traditional assets.
BTC price
Bitcoin has continued the recent trend of consolidation in recent days, because the price is still locked around the $ 96,000 level.
