Bitcoin Rallies as Stock Market Correlation Hits Two-Year High

Bitcoin continued its upward momentum this past week, reaching as high as $66,000 on Friday, September 27th, as it looks to close out September strong and enter October with even more gains.

This recent climb has fueled discussions about the growing connection between Bitcoin’s performance and the US stock market, particularly the S&P 500.

$BTC‘s correlation with U.S. stocks reached a two-year high this week, a level that was only surpassed in the second quarter of 2022. pic.twitter.com/in6YRZq2Iw

— IntoTheBlock (@intotheblock) September 27, 2024

According to crypto analytics firm IntoTheBlock, the correlation between Bitcoin and the S&P 500 has hit its highest level in over two years.

This link has sparked questions about how this could impact investor behavior, as the S&P 500 has also been recovering, posting a 4% rise in September. Meanwhile, Bitcoin’s price has surged over 11% this month, despite September’s usual bearish trend.

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Both markets have been buoyed by an influx of global liquidity, which increased by $1.426 trillion last week, according to crypto analyst Ali Martinez.

This surge in capital has benefited Bitcoin and other risk assets, with the potential for more gains as liquidity continues to flow into October.

Alexander Zdravkov