Bitcoin and U.S. Stocks Are Aligning Again – What Does This Mean for You?
Bitcoin has broken a key resistance level and is increasingly moving in sync with U.S. stocks.
BTC and the S&P 500 have recently observed a high correlation.
- The cryptocurrency has continued trading above $65,000 on price charts.
Bitcoin [BTC] recently broke through a significant resistance level and has continued its positive upward trend on the charts. Interestingly, the correlation of this cryptocurrency with U.S. stocks has reached its highest point in the past two years. This means that Bitcoin is increasingly moving alongside traditional financial markets.
The correlation of Bitcoin with U.S. stocks has reached a two-year high.
Recent data from IntoTheBlock showed that the correlation of Bitcoin with U.S. stocks has peaked in the past two years. Over the past three months, Bitcoin has faced average volatility along with periods of minor increases and decreases, maintaining a range close to its initial value.
Overall, Bitcoin’s price movement has been relatively stable, showing a subtle positive trend leading into the end of September.
Source: IntoTheBlock
In contrast, the S&P 500 has shown a more stable performance with less volatility compared to Bitcoin. Although both assets have moved relatively in sync, this reflects similar sentiments in the market.
While the inherent volatility of BTC leads to more pronounced movements, the parallel trends indicate that it is currently behaving like a risk asset, closely following macroeconomic trends and investor sentiments.
Implications for Bitcoin Investors
The price trend of Bitcoin indicates a risk-seeking environment, where investors maintain or slightly increase exposure to traditional stocks and cryptocurrencies. If the S&P 500 continues its steady performance or improves, BTC could benefit from positive sentiment. However, any negative shocks in the stock market may impact Bitcoin due to their correlated movements during this period.
With this correlation persisting, Bitcoin’s price movements may increasingly reflect changes in traditional stocks. During bullish stock market conditions, this could be positive for BTC, as risk-seeking sentiment drives more flows into Bitcoin and other crypto assets.
Bitcoin Continues Its Upward Movement
Daily chart analysis of Bitcoin showed that it closed the last trading session with a gain of less than 1 percent.
However, the price briefly reached the $66,000 level and settled around $65,789. At the time of writing, Bitcoin was trading at approximately $65,660, showing a slight decrease of less than 1 percent on the charts.
Source: TradingView
Additionally, analysis of its Average True Range (ATR) indicated a value of approximately 2099.44. This means that on average, the price range of Bitcoin (from high to low) over the past 14 periods is around $2,099. The ATR has been declining since mid-August, suggesting that volatility has decreased over time.
This could indicate that the market has experienced fewer price fluctuations compared to previous months.
When the ATR is low, it may suggest that the asset is preparing for a breakout in either direction.
