New Kraken Report Suggests Bitcoin’s Correlation with Gold Is Weakening

Researchers at the Kraken exchange found that while Bitcoin’s correlation with gold has decreased, the asset’s correlation with the S&P 500 is increasing.

Kraken Intelligence, the research arm of major United States-based cryptocurrency exchange Kraken, has released its Bitcoin Volatility Report for June 2020.
Bitcoin volatility hits 6-month low
The new report, published on July 9, outlines a 31% drop in Bitcoin trading volumes, which has resulted in Bitcoin’s annualized volatility hitting a six-month low, with June accounting for 51% of the volatility.
According to the report, the sharp drop in trading volume and volatility marked June as Bitcoin’s quietest month since February 2020. This also created a major trend reversal, greatly affecting Bitcoin’s correlation with stocks and gold.
Correlation with S&P 500 is growing <br />While Bitcoin’s correlation with gold is decreasing, the cryptocurrency’s correlation with stock market indices like the S&P 500 is increasing. The reversal caused Bitcoin’s correlation with the S&P 500 to climb to a high of 0.65 in late June, according to Kraken Intelligence. The monthly average surged to 0.52 from the one-year average of 0.26, analysts noted.
Kraken’s data on the S&P 500 correlation appears to align with information shared by digital asset exchange OKCoin earlier this week. Daniel Koehler, liquidity manager at OKCoin, said the exchange had seen a “high” correlation between BTC and the S&P 500 for a month.
Earlier in June, Equity Convection analyst PlanB claimed that the high correlation between Bitcoin and the S&P 500 should allow Bitcoin’s price to reach $18,000.

Source: Cointelegraph