Bitcoin and the broader crypto market are recovering despite a downturn in stock markets, especially in technology stocks, indicating a break in the correlation between the two.
The flagship crypto rose over 4% in the past few hours to $66,377 at the time of writing, based on CryptoSlate facts.
Meanwhile, other top tokens such as Ethereum and Solana rose 2.24% and 7.8% respectively – with ETH trading at $3482 and SOL at $170 at the time of writing.
Technical correlation
The crypto market recorded a significant increase as trading began in New York, climbing to new monthly highs despite most stocks falling at the same time. This is a notable break in the correlation between crypto and tech stocks, which have largely moved in parallel since about 2020.
The correlation has often been linked to increasing adoption among institutional investors, who view Bitcoin and other cryptocurrencies through a similar lens as technology stocks, leading to synchronized trading patterns.
Studies have shown varying degrees of correlation between Bitcoin and technology stocks. For example, during certain periods, the correlation coefficient between Bitcoin and the NASDAQ-100 index (which includes a lot of technology) has increased, indicating a stronger relationship.
Despite the growing correlation, there are still periods when Bitcoin and tech stocks diverge due to unique events impacting the crypto market, such as regulatory news or major developments in blockchain technology.
Upward trend in the market
Bitcoin’s latest rally is fueled by several factors, the most prominent of which are rumors that former President Donald Trump plans to announce plans to make BTC a strategic reserve for the US.
Trump has shifted completely to a pro-crypto stance in recent weeks, as the issue has become increasingly salient among many voters. He has received widespread support among leaders in the technology and crypto industries, who believe his policies will be more beneficial to both sectors.
Strong support from a presidential candidate who is currently favored to win has given Bitcoin new momentum after falling to a multi-month low amid recent selling in Germany.
Meanwhile, Solana is outperforming most of the top 10 tokens as the meme frenzy continues to sweep the community despite a significant slowdown compared to earlier this year. The latest rally in SOL has also led to a notable increase in most of the top memecoins.
SOL’s momentum is mainly driven by increased adoption and expectations that this will be the next sign to get the ETF treatment. Some companies have already submitted applications for a spot Solana ETF.
Bitcoin Market Data
At the time of going to press 18:38 UTC on July 19, 2024Bitcoin is number 1 in terms of market capitalization and so is its price upwards 4.2% in the last 24 hours. Bitcoin has a market capitalization of $1.31 trillion with a 24-hour trading volume of $32.88 billion. Learn more about Bitcoin ›
Summary of the crypto market
At the time of printing 18:38 UTC on July 19, 2024the total crypto market is valued at € $2.42 trillion with a 24-hour volume of $76.86 billion. Bitcoin’s dominance currently stands at 54.16%. Learn more about the crypto market ›