Wednesday 25 May 2022
Home / altcoins / False Safe Haven: Bitcoin Correlation With S&P 500 Hits ATH

False Safe Haven: Bitcoin Correlation With S&P 500 Hits ATH

Data shows the Bitcoin correlation with S&P 500, and hence the stock market, has now set a new all-time high (ATH).

Bitcoin Correlation With S&P 500 Reaches New High

As pointed out by an analyst in a CryptoQuant post, the BTC correlation with the stock market is currently at an all-time high, further damaging the “safe haven” narrative.

The “Bitcoin correlation with S&P 500” is an indicator that measures how strongly the price of BTC reacts to volatility in S&P 500, as well as the direction of the response.

When the indicator has values greater than zero, it means there is a positive correlation between the stock market and the price of the crypto at the moment. “Positive” here means that BTC moves in the same direction as S&P 500.

On the other hand, correlation values less than zero imply that BTC reacts to S&P 500’s price changes by moving in the opposite direction.

Related Reading | Bitcoin Plunges Below $40 As Russia Has Reportedly Given Its Forces Order To Attack Ukraine

Values of the indicator exactly equal to zero naturally mean that there is no correlation between the two assets. Now, here is a chart that shows the trend in the S&P 500 and Bitcoin correlation since the year 2013:

The indicator's value over the history of the crypto | Source: CryptoQuant

As you can see in the above graph, the correlation between Bitcoin and S&P 500 swung between positive and negative while remaining low for the most part of BTC’s history.

Related Reading | Why Bitcoin Won’t Crack Over Fresh Bear Assault, Next Potential Target For BTC

However, since late 2019-early 2020, the two assets have become strongly, positively correlated. During 2020, the metric had a crash due to the COVID sell off, but the indicator sharply rose during the 2nd half of 2021 and 2022 so far.

The correlation between the Bitcoin and the stock market has now set a new all-time high (ATH) of +0.5468 this month.

Such high correlation between the assets has further put a dent on the narrative of “digital gold” as the crypto is no longer the safe haven it once was.

BTC Price

At the time of writing, Bitcoin’s price floats around $39k, down 12% in the last seven days. Over the past month, the crypto has gained 10% in value.

The below chart shows the trend in the price of BTC over the last five days.

BTC's price seems to made some recovery over the last couple of days | Source: BTCUSD on TradingView

A few days back, the price of Bitcoin plunged down, touching as low as $36.4k. Since then, the value of the coin has shown some recovery, breaking above the $39k level again today. At the moment, it’s unclear whether this fresh uptrend will last.

Featured image from, charts from,

About Sean Patterson

Check Also

Largest difficulty drop since July 2021 — 5 things to know in Bitcoin this week

Bitcoin (BTC) is off to a better start than most this week as bulls avoid serious losses into the weekly close. Still heavily tied to declining stock markets, the largest cryptocurrency is nonetheless defending $30,000 on May 23 and eyeing the top of its post-Terra (LUNA) trading range. While there are no signs of an impending miracle price recovery, some are hoping that upside will feature before any form of reversion to a downtrend. Macro conditions remain tenuous, and the week of the World Economic Forum’s (WEF) Annual Meeting is due to add fuel to the fire surrounding the tolerance of Bitcoin. Add to that the largest downward difficulty adjustment since last July and it becomes clearer that Bitcoin is battling for strength on multiple fronts. What could happen in the coming days? Cointelegraph presents several factors to keep in mind when it comes to BTC price action. BTC price “nuke” still on the tableIn a refreshing contrast to recent weeks, Bitcoin managed to show strength follo..

Leave a Reply

Your email address will not be published. Required fields are marked *