Bitcoin has surged 25% in two days, from under $65,000 to nearly $80,000, marking its most notable price recovery of the year and flipping its long-running underperformance against US equities. According to analytics firm Glassnode, the cryptocurrency had underperformed the S&P 500 on approximately two out of every three trading days over the past three months, the longest such streak in six years. This rally coincides with a 1-2% loss for the S&P 500 and Nasdaq, breaking their three-week winning streak, though analysts caution it is too early to confirm a decisive decoupling.
After months of struggling to keep pace with US equities, bitcoin has finally flipped the narrative. The primary cryptocurrency experienced its most notable price recovery of the year, skyrocketing by 25% from under $65,000 to almost $80,000 within two days before its run was paused.
Although this surge is impressive on its own, Glassnode highlighted another notable development that makes it even more interesting. BTC has suddenly started to substantially outperform US stocks after months of doing the opposite.
The analytics company stated that the cryptocurrency had underperformed the S&P 500 on approximately two out of every three trading days in the past three months. Glassnode described this as bitcoin’s longest streak of relative underperformance against the benchmark US index in six years.
However, the trend started showing cracks even before BTC exploded on Wednesday afternoon. On Monday, the index slipped by over 0.5% while bitcoin posted a notable 2% increase, one of the rare sessions when the cryptocurrency moved decisively in the opposite direction.
The major run on Wednesday confirmed the changing tides. The S&P 500 and Nasdaq snapped a three-week winning streak, posting losses of 1-2%.
As Glassnode noted, “BTC only outperformed the S&P500 on around one third of trading days over the last 3 months.” The firm added, “This is the longest underperformance streak we’ve seen over the last 6 years of history.”
Although BTC has underperformed US equities on most days, it has dwarfed the stock market during its better days, as the magnitude of its excess returns has been considerably larger. The latest deviation is a prime example.
It would be premature to conclude that there’s a decisive decoupling, as BTC has repeatedly traded as a high-beta risk asset. Nevertheless, the cryptocurrency finally moved in the right direction, gaining over 25% weekly and reaching a three-month peak while US equities marked their first losing week in a month.
