Key Points
- Bitcoin shows signs of reduced correlation with the stock market, outpacing the S&P 500 with a 3.7% gain.
- Strong support at $95K-$98K and minimal resistance above $104K positions Bitcoin for potential new highs.
Bitcoin’s recent performance indicates a possible reduction in its correlation with the stock market. The cryptocurrency has outpaced the S&P 500 with a 3.7% gain.
Bitcoin’s Decoupling from Equities
According to data from Santiment, Bitcoin began outperforming the S&P 500 in January 2025. While Bitcoin posted a 3.7% gain in a single day, the S&P 500 only recorded a 0.4% increase. This divergence suggests that Bitcoin may start operating independently of stock market fluctuations.
Historically, the strongest bull runs in the crypto markets have occurred when there is a low correlation with equities. Analysts believe that if Bitcoin can maintain its momentum and operate independently of macroeconomic factors, it could potentially reach new all-time highs in 2025.
Support and Resistance Levels for Bitcoin
Bitcoin is currently well above a critical support zone between $95,400 and $98,400. On the upside, Bitcoin faces minimal resistance, with only 107,000 BTC held by 102,168 addresses between $104,700 and $105,770. If Bitcoin breaks through this light resistance zone, further upward movement is expected.
Data from Coinglass shows an increase in Bitcoin Futures Open Interest, now at $64.96 billion, up 2.20% daily. Trading volume surged by 49.82% to $86.96 billion, and options volume jumped 76.78% to $3.54 billion. However, rising open interest and leveraged positions can increase the risk of volatility.
With a strong support base and minimal resistance ahead, analysts believe Bitcoin is well-positioned to test new all-time highs if it continues to decouple from traditional markets.