Bitcoin’s 90-day correlation with gold hits nine-year high

$BTC’s 90-day price correlation with gold has reached +0.56, its highest level since most data providers started measuring it in January 2017 and higher than its prior record of +0.5 in November 2020.

Meanwhile, the 90-day correlation of $BTC with the Nasdaq 100 index slid to roughly +0.30 over the same window, a one-year low.

Pearson price correlations range from -1 to +1. Perfect correlation is +1, meaning the assets always affect one another’s price and never decouple in their correlated movements.

At 0 or “no” correlation, the assets never affect one another’s price. At -1, the assets move in perfectly opposite directions — one rising and one falling by proportionally consistent amounts.

Mathematicians choose a set length of time to determine how correlated their prices are; for example, over the last 90 days.

At a +0.56 correlation and rising, the narrative of “digital gold” is back for $BTC and displacing its Nasdaq “tech play” narrative.

Noting the increased coupling, Bitwise Asset Management wrote, “The argument that $BTC is ‘just a leveraged tech investment’ may not be true after all.”

Bloomberg’s senior ETF analyst similarly found that $BTC correlated less with US stocks over six months than gold. The finding “blows up the claim,” he said, that $BTC “is just QQQ.”