Shift in Correlation: Bitcoin Reflects US Tech Sector as Its Connection with Gold Diminishes

Bitcoin, once highly correlated with gold, has deviated from this trend since the October 10 crash, according to the Kobeissi Letter. Post-crash, Bitcoin's value decreased significantly while gold prices continued to rise. This divergence is believed to be due to the excessive leverage used in the crypto markets. Meanwhile, Bitcoin's correlation with the US tech sector has increased, with its 30-day correlation with the Nasdaq 100 Index reaching a three-year high. Over the past five years, except for a brief period in 2023, Bitcoin's correlation with the tech sector has been positive, leading to the conclusion that Bitcoin is increasingly behaving like a leveraged tech stock.