- Bitcoin’s correlation with Nasdaq has hit 70%, a level historically followed by a sharp price decline exceeding 20%.
- Institutional investors continue to show confidence in Bitcoin as BlackRock expands its Bitcoin offerings to European clients.
- Bitcoin’s 21-day moving average at $85,200 signals bullish momentum, indicating potential resilience despite past market patterns.
Bitcoin’s correlation with the Nasdaq has surged close to 70%, a level reached only twice before significant price drops. Data from Singapore-based blockchain firm Matrixport indicates that previous instances of such correlation preceded a 20% Bitcoin price decline.
Matrixport attributes this correlation to the recent repricing of earnings expectations before the Q1 earnings season. Economic uncertainties along with ongoing tariff discussions have merged Bitcoin in a similar trajectory with tech stocks. The trading behavior of Bitcoin has been shaped by several factors which lead it to parallel movement with the Nasdaq.
History Suggests Imminent Decoupling
Despite the strong correlation, historical data suggests it may not last long. Matrixport highlights that similar instances were followed by a divergence, with Bitcoin’s price declining sharply. If past trends repeat, a significant shift in Bitcoin’s movement relative to the Nasdaq could be forthcoming.
European clients of BlackRock now have access to a Bitcoin Exchange Traded Product (ETP). The Bitcoin Exchange Traded Product introduction marks an important milestone as financial institutions steadily demonstrate rising interest in Bitcoin despite worries regarding its temporary tech stock relationships. Bitcoin’s acceptance by global financial investors has recently risen to become a mainstream investment practice.
Bitcoin’s Technical Indicators Show Strength
Although historical patterns indicate potential divergence, Bitcoin’s technical indicators suggest underlying strength. Spot Bitcoin exchange-traded funds have seen renewed inflows, supporting its price above the $85,000. Analysts view this support as essential for Bitcoin’s next potential upward move.
According to 10x Research’s Markus Thielen, Bitcoin’s reversal indicators have turned bullish. The 21-day moving average now sits at $85,200, signaling possible upward momentum. These bullish signals suggest Bitcoin could defy historical trends and maintain its strength despite past correlation patterns.
Historical analysis indicates that Nasdaq may split off from its trajectory, but no exact time has been identified. Bitcoin stays in an area of support while investors actively monitor its position. The following weeks will establish if Bitcoin functions according to historical patterns with the technology sector or creates its independent price movement.
