Bitcoin Correlation With The S&P500 Drops To Zero – Will History Repeat?

Bitcoin’s short-term price direction remains uncertain, with divided opinions among analysts and investors. Some expect a breakout into all-time highs (ATH) above $109K, while others fear increased selling pressure that could send BTC into lower demand zones. The price has been trading in a narrow range for the past twelve days, holding above $94K and below the $100K mark, leading to speculation about the next move.

Data from IntoTheBlock shows a significant shift in Bitcoin’s market behavior: its correlation with the S&P 500 has dropped to zero, indicating no current linkage between the two assets. Historically, BTC has moved in tandem with the stock market, reacting to macroeconomic events, interest rate policies, and risk-on/risk-off sentiment. However, this decoupling suggests that BTC is now trading based on its own internal market dynamics, rather than following traditional financial markets.

Could this signal the start of another massive rally, or is Bitcoin simply moving into a more speculative and unpredictable phase? The coming weeks will be crucial in answering that question.

Bitcoin Prepares For A Strong Move

Bitcoin remains structurally bullish despite failing to confirm short-term direction, and investors are now looking for signals of the next major move. While uncertainty continues to dominate the market, many analysts argue that BTC is preparing for a massive breakout into all-time highs (ATH).

Key data from IntoTheBlock reveals that Bitcoin’s correlation with the S&P 500 has dropped to zero, signaling that BTC is now decoupled from traditional markets. This is a rare event, as Bitcoin has generally followed macroeconomic trends and stock market movements in the past. However, with no clear correlation, BTC appears to be moving on its own cycle, dictated by internal market forces rather than external financial events.

The last time we saw such a low correlation was on November 5th, 2024, just before Bitcoin surged past $100K. If BTC reclaims the $100K level in the coming days, analysts expect a massive rally to follow, potentially leading to a new all-time high.

Speculation is rising, with analysts suggesting that this recent consolidation is the calm before the storm—and a bullish storm at that. Historically, long periods of sideways trading near cycle highs have led to explosive breakouts, and current market conditions seem to align with that pattern.

Price Consolidation: Technical Levels

Bitcoin is trading at $96,300 after nearly two weeks of sideways trading in a tight range between $94,000 and $100,000. This prolonged consolidation phase signals market indecision as both bulls and bears struggle to gain control.

Despite short-term uncertainty, the long-term trend remains bullish, with Bitcoin holding above key demand zones. However, investors are growing impatient, as the lack of a clear breakout has raised doubts about whether BTC will push into new all-time highs (ATH) or face a deeper correction.

If Bitcoin reclaims the $100K mark, analysts expect an explosive rally that could drive the price toward unexplored territory. Historically, consolidation near ATH levels often precedes major breakouts, and many traders are betting on this scenario playing out again.

On the flip side, a break below $94K could spark strong selling pressure, forcing BTC into lower demand levels around $89K–$90K. For now, the market remains in limbo, awaiting confirmation in either direction. Traders are closely watching key levels, as the next move could set the tone for Bitcoin’s trajectory in the coming weeks.

Featured image from Dall-E, chart from TradingView