fxstreet.com
- Bitcoin hit a new milestone as correlation with big technology stocks hits an all-time high.
- The 40-day correlation between Bitcoin and Nasdaq 100 index hit 0.6945 on April 8.
- Analysts predict Bitcoin price could hit $52,000, making a u-turn in its bearish trend.
Bitcoin price could experience a trend reversal as correlation with the Nasdaq 100 hits a key milestone. Analysts are bullish on the Bitcoin price rally, and have set a target of $52,000 for BTC.
Bitcoin price could break into a rally to $52,000
Bitcoin price has consistently moved in the same direction as the Nasdaq 100 index for over six months. Analysts at Bloomberg believe Bitcoin is more in unison with big technology stocks than ever before.
The 40-day correlation between Bitcoin and Nasdaq 100 hit an all-time high of 0.6945 last Friday. The rise in correlation erodes the argument that Bitcoin is a diversifier of assets in an investor's portfolio. However, an increase in this correlation has historically pushed Bitcoin price higher.
In previous bull runs, 2017 and 2020, Bitcoin's correlation with tech stocks has fueled price rallies in the asset. The demand for Bitcoin has climbed consistently with the rise in correlation with Nasdaq 100 stocks.
Bitcoin price recently plummeted to $41,000. Proponents believe factors like increasing outflow from cryptocurrency exchanges, activity in Satoshi-era Bitcoin wallets and the rising correlation with technology stocks could drive the asset's price higher.
@Koolaid_crypto, a pseudonymous crypto analyst, believes Bitcoin encountered selling pressure over the weekend, and a macro formation that looked like a descending broadening wedge. The analyst believes Bitcoin price could test the 61.8% Fibonacci retracement level at some point and reveals a bullish outlook on BTC.
FXStreet analysts have evaluated the weekly Bitcoin price chart, predicting a rally to $52,000. Even though analysts believe a weekly close below $42,000 would indicate a bearish trend reversal, they foresee the Bitcoin price on track to target the $52,000 level.