Bitcoin is up 6% in the past 24 hours and over 18% this past week as it continues to rally higher amid a sell-off in the stock market.
Marcus Sotiriou, an analyst at UK-based digital asset broker GlobalBlock, says Bitcoin’s big move has seen the benchmark crypto “decouple” from the stock market.
In a note on Tuesday, Sotiriou said that BTC’s “incredible” gains this week are a signal that the market could be looking at a potential decoupling from stocks. This, he notes is likely to be the outlook in the short term.
Indeed, looking at the stock market, we see the S&P 500 is headed for another negative daily close with losses above 1.5% on Tuesday.
Why is Bitcoin up today?
Commenting on the recent correlation between Bitcoin and stocks, the GlobalBlock strategist said that this had been the case “for months.” However, the cryptocurrency is signaling what could be an uncorrelated breakout, albeit possibly a short-term one.
And on why Bitcoin is rallying as the S&P 500 falls, Sotiriou explained:
“Bitcoin is being heavily bid due in part to the narrative of being a permissionless and censorship-resistant way of transferring value, as it has been used during the crisis in Ukraine as well as political unrest in Canada.”
But it’s not just stocks that BTC is outshining this week. The flagship crypto is outperforming gold, which last week rallied as Bitcoin fell alongside stocks. Today, despite rallying to highs of $1,945 with over 2% in gains, gold trails BTC’s 6% upside.
“It is [also] fascinating that, after a week into geopolitical uncertainty, Bitcoin is outperforming gold, which is known as a safe-haven asset,” Sotiriou noted.
