Over the past few days, the correlation between bitcoin and the S&P 500 US stock indicator has increased again. This is an alarming trend, analysts from the Santiment team believe.
Their report says that the US market is stagnating with the upcoming presidential election.
The Federal Reserve has announced the launch of a new programme to stimulate business activity. However, the date on which the injection of capital into the economy has begun is not yet known.
Nervousness in the market is increasing, as traders are not sure that the market will start to grow after the elections and the Federal Reserve’s steps to stimulate the economy.
If the financial sector support programme does not deliver the expected result and the S&P 500 begins to decline, bitcoin is also at risk of rolling back.
The largest digital currency has fallen sharply in price amid the crisis around OKEx. It then recovered slightly, rising to $11,454 on Sunday 18 October.
Trading in the United States ended this week with the S&P 500 closing at a low of 3,488 points. According to analysts, the inflow of capital into high-tech sectors supported BTC, which allowed the coin to win back some positions.
Bitcoin will only be able to „shoot“ if its dependence on the stock market is minimal, says the Santiment report.
The experts added:
For a long period of time, when COVID-19 became firmly established in the mass consciousness, the correlation between the two markets (S&P 500 and Bitcoin) was abnormally high. Falling below zero will be an encouraging „bullish“ sign.