BTC's weakening correlation with indices highlightsâ
The last trading session on Wall Street this week is marked by bulls, who dominated the market at the moment. Much of the credit for such good sentiment comes from the US consumer spending data, which rose in April. On the other hand, however, the Michigan Sentiment Index fell to its lowest levels since 2021.Â
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Today's session seems fundamental due to the fact that bulls are struggling to close the first weekly candle on the upside after a series of 7 weeks of losses. The S&P 500 Index rose for a third straight session and had a chance to break its longest streak of weekly declines since 2001.
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Cryptocurrencies are not correlating with the indices today, with Bitcoin and Ethereum showing increasing divergence and their price reactions recently being similar to the NASDAQ (US100) technology index. This could indicate a potentially broader decline in risk appetite among investors and contradict the theory of a rising cryptocurrency cycle 'different from previous ones.
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In the past, the beginning of a bull market in cryptocurrencies has always coincided with the date of the halving of Bitcoin's supply, the so-called 'Halving'. Some analysts believed that the current cycle is different due to financial institutions supporting blockchain technology and investing in Bitcoin and that past cycles will be disrupted. However, the quotes of the last days contradict such a scenario.
Chart of the US100 index and Bitcoin, W1 interval. The correlation between the index of technology companies and Bitcoin is slowing down, as evidenced by the behavior of both instruments this week. Source: xStation 5
