Key Insights:
- Bitcoin loses correlation with S&P500 and Nasdaq amid rising debt, persistent deficits and higher yields.
- Eric Balchunas said Bitcoin’s six-month correlation with U.S. stocks has fallen below that of gold, small caps, emerging markets.
- Glassnode identified $83,000–$86,000 BTC price as the main supply zone for sell-side pressure.
Bitcoin price has shown an unusual shift in its relationship with traditional markets following its sharp August recovery.
Glassnode reported that Bitcoin’s rolling 30-session correlation with the S&P 500 fell toward zero during the recent rally. Grayscale separately found that BTC’s 90-day correlation with the Nasdaq declined while its relationship with gold strengthened.
The move has renewed debate over whether Bitcoin is trading more like a scarce macro asset than a high-beta technology investment. However, Glassnode cautioned that similar decorrelation episodes during sovereign bond selloffs have historically been temporary rather than permanent structural shifts.
Bitcoin Decouples from S&P 500, Nasdaq, Follows Gold
Bitcoin is increasingly decoupling from equities, with its correlation with the S&P 500 approaching its lowest level in nearly two years. The close relationship between Bitcoin and equities that defined much of the recent downtrend is now fading, as per data from Glassnode.
On the other hand, data from Grayscale shows that Bitcoin is also showing a stronger correlation with gold. “Rising debt, persistent deficits, and higher yields are pushing investors toward alternatives like Bitcoin and gold,” Grayscale reported.
Bitcoin Establishes Weak Link With Equities
Bloomberg’s ETF strategist Eric Balchunas reported that Bitcoin’s correlation with U.S. equities has weakened significantly over the past six months. According to him, BTC’s relationship with U.S. stocks fell below that of gold, small-cap stocks, emerging markets and Treasuries.
Balchunas noted that Bitcoin’s correlation with equities has historically remained around 0.40. While gold and Treasuries have become more closely correlated with the cryptocurrency in recent months.
The shift challenges the view that Bitcoin’s recent market behavior has been driven primarily by its correlation with the Nasdaq-100.
BTC Price Faces Supply Pressure At $83K–$86K
Blockchain analytics firm Glassnode reported that Bitcoin’s August 19 short squeeze pushed BTC above $80,000. However, the rally has stalled below the $83,000–$86,000 long-term holder supply zone before retreating toward $76,000.
When BTC traded near $78,000, the share of supply in profit had risen to 68% from 65% in May. which points to greater chances of sell-side pressure. Glassnode identified $62,000–$65,000 as the key support zone, while $83,000–$86,000 remains the main resistance area.
In the options market, the 7-day 25-delta skew rose sharply during the short squeeze. This shows that traders are chasing upside calls before moving back toward neutral. Meanwhile, the 180-day skew remained stable, suggesting short-term bullish sentiment has cooled.
On the other hand, Charles Schwab noted that a sustained move above $80,000 could set Bitcoin up for a year-end rally. The firm noted that holding above the level would bring the average BTC investor back into profit. It also highlighted October through December as historically strong months for the cryptocurrency.
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