Bitcoin and the S&P 500: correlation and disappointment
Bitcoin and the S&P 500: correlation and disappointment

Bitcoin and the S&P 500: correlation and disappointment

By Federico Izzi - 12 Mar 2020

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When comparing the graph of Bitcoin and the S&P 500 since mid-February it looks like a specular graph. A similar trend was characterizing Bitcoin and gold from mid-December until a few weeks ago. 

However, looking now at the chart of Bitcoin and S&P 500 it can be seen that in this last month the two markets are highly correlated

BTC vs SP500

This is an indication that does not look good in the coming weeks but, as Bitcoin has accustomed us in the past, it is very likely that this correlation will be lacking. 

At such a difficult time, with the tensions in the financial markets and from a psychological point of view, the expectation of the halving that is getting closer and closer seems to be overshadowed.

In the case of cryptocurrencies, the work done in recent months has been totally cancelled out and doubts are beginning to arise about the sector, which is in an equally delicate phase as the world’s stock markets, where further lows and sinkings are currently being recorded.

On the European markets, the Dax, Eurostoxx and Ftsi Mib indices continue to show double-digit declines of 10%. 

The fall in the US stock indices today is blocking trading, which will most likely be suspended tomorrow for an indefinite period to deal with a pandemic crisis that has now reached the United States.

This will necessitate actions such as those taken in Europe leading to the freezing of US stock market indices such as the CME, the CBOE and most likely the NASDAQ.

The only asset that is proving to be an anticoronavirus is gold, which, although shrinking, continues to remain at the highs of recent years, highs recently updated. 

Bitcoin and cryptocurrencies were expected to behave differently. What is certain is that this movement has definitely cancelled all the rises that have accompanied us until a few days ago and for much of the quarter that is about to end so excitingly. 

All is not lost, but we will have to reckon with a global market where all indices are set downwards.


Federico Izzi

Financial analyst and independent #trader – S.I.A.T. & partner. He operates actively on stock and derivatives markets (futures and options) since 1997. A precursor of cyclic-volumetric analysis he is known for having identified the most important upward and downward movements in the financial markets of recent years. He participates annually as a speaker at the ITForum in Rimini since the 2010 edition and InvestingRoma and Napoli since the first edition of 2015. He is a guest and market expert on the "Trading Room" and "Market Driver" broadcasts of Class CNBC, Borsa and on the evening news of Traderlink. Since July 2017 he is a permanent guest on LeFonti.TV, the only weekly national space dedicated to cryptocurrencies alongside the most important international experts in the field. He was interviewed as a cryptocurrency expert for Forbes Italia, Panorama, StartupItalia and DonnaModerna. He was recognized as the first Italian technical analyst to have published the first secular cyclic analysis on Bitcoin. Periodically publishes articles on ITForum News, Sole24Ore, MILANOFINANZA, TrendOnLine and Wall Street Italy. Federico Izzi is... "Zio Romolo".

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