Bitcoin’s correlation with the S&P 500 hits a 17-month high

The long-standing debate over whether bitcoin is a safe-haven asset (similar to gold) or a risky investment may be reignited by the cryptocurrency’s increased sensitivity to stock markets and fears that aggressive regulatory plans by the Federal Reserve could lead to a recession in the US economy.

According to Arcane Research, the 90-day correlation between bitcoin and the benchmark S&P 500 stock index rose to 0.49 last Friday, the highest level since October 2020. «The correlation between bitcoin and the S&P 500 has been higher for only five days in the history of BTC,» the authors of the study note.

This situation can be explained by the fact that bitcoin itself is a rather volatile asset, and geopolitical and macroeconomic uncertainty prevents it from breaking out of the resistance zone and gaining weight. Cryptocurrencies need any fundamental changes, whether it is Ukraine’s victory in the war with Russia or new serious speculation or perhaps new macro investments. That is why now is the worst time to learn how to play futures using real money.