Will the Bitcoin Stock Market Correlation continue in the Future? Increasing regulations in various countries are making Bitcoin more and more a classic financial product.Bitcoin has been getting more and more representation on the stock market in recent months . The first Bitcoin ETFs were approved in the fourth quarter of 2021.Institutional investors have taken over the crypto market, most notably Bitcoin, in recent years. Your willingness to invest depends heavily on financial developments.
There are several reasons for the increasing dependency: In particular, the development of tech stocks in the USA, represented by the Nasdaq Composite Index, has recently been almost parallel to the development of the Bitcoin price.įig.3 NASDAQ 1-day chart showing the similarity in prices with BTC – TradingViewįurthermore, we see a similar reactivity of bitcoin to external, especially negative influences as with stocks. Recently, the rumors about rapid interest rate increases by the central banks and the conflict in Ukraine have rather damaged the Bitcoin price. The trends have been confirmed in recent weeks and months: the Bitcoin price is heavily dependent on developments on the stock market. Why is Bitcoin Correlating more with the Stock Market? The Bitcoin price follows the developments on the international stock markets more and more.īuy the Bitcoin in 2022 easily on Binance and Bitfinex ! But another observation could also be made. This raises the theory that the Bitcoin cycle has now lengthened significantly. We already saw a slightly longer cycle in 2017 compared to 2013. Instead, we saw a sharp correction of over 45% over the last 3 months.įig.2 BTC/USD 1-day chart showing the Bitcoin crash – TradingView
So far, however, this has not happened in 2022. Many forecasts spoke for a six-digit price. The Bitcoin cycles are based on the Bitcoin Halving Events. In a halving, the mining rewards are halved. After 1.5 years after the halving, Bitcoin prices rose massively.įig.1 Stock-to-flow model of the Bitcoin price showing each Bitcoin Cycleĭid the Bitcoin Price Behavior CHANGE recently?īased on the cycles presented, many analysts also expected that the Bitcoin price would rise again massively at the turn of the year 2021/2022. The bull markets were followed by a sharp drop (about 80%) and a transition to a bear market. The development of the price in recent years has been easy to predict, at least in the medium to long term. We saw a 4-year cycle that featured a bear market and a bull market. The cycle ended with a massive parabolic advance in Bitcoin prices. This was the case at the end of 20 respectively.įurthermore, we saw the price development of Altcoins with a slight lag compared to Bitcoin prices. Bitcoin peaked in December 2017, altcoins a month later in January 2018. According to “ Normies“, Bitcoin prices are extremely unpredictable and risky. There is a risk of a massive price loss at any time.
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