There’s been a lot of interest and skepticism around bitcoin as an uncorrelated or ‘safe haven’ asset. We’re about to find out who’s right.

Up until a few months ago, there was a coherent narrative around bitcoin as an uncorrelated asset: one that acted independently of the global markets, and potentially more like gold – a safe haven that wouldn’t react when stocks and bonds were crashing.

That narrative was called into question at the end of 2018, as bitcoin’s slide from $6k coincided with wider turmoil on the markets. Tech stocks in particular were taking a beating, driving the major indexes lower. And, since bitcoin has become more and more popular among regular traders, it should come as no surprise that it was starting to be treated more as a ‘risk off’ asset – that is, one you only buy when you’re feeling flush and willing to put some cash into a more speculative play.

But perhaps that picture was only temporary. Right now, we’re potentially in the early stages of a change in fortunes for stocks, gold and crypto. Let’s take a quick overview of each market:

The Dow Jones has had a multi-year run, but looks to have hit a ceiling at 26,800. On Christmas Eve it fell as low as 21,800, almost 20%. By the standard definition, that’s just off a bear market.

The UK’s FTSE 100 put in what looks a lot like a double top in the first half of 2018. After peaking at almost 7,900, it has since plunged as low as 6,600. It’s also flirting with bear market territory right now.

Gold , meanwhile, after hitting an all-time high of $1,920 in 2011, just after as the financial crisis really started to bite, has been out of favour. It hit a bottom just over $1,000 in December 2015, and seems to have put in another higher low in the summer of 2018 at $1,160. It’s now at its highest price in six months.

Bitcoin has had a tough 2018. Its recent low came in at $3,122 on 15 December 2018, after which it staged a strong recovery – recently rising back above $4,000. The macro trend is still unclear. We need more data to know whether that was the bottom or whether the bear trend is still in effect.

So we can see that – over the last few weeks – bitcoin and gold have been gaining value, while stocks have suffered some heavy losses. Crypto and stocks have de-correlated once again. We need to wait before we can call it properly, but at this point it seems likely that bitcoin has re-established itself as a counter-play to the conventional markets. It’s still heavily oversold by any given indicator, while the pain for stocks may only just be starting.

In short, one of the many factors that may drive a return in bitcoin’s fortunes is capital coming out of traditional assets and looking for anything that isn’t already overbought.

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