Bitcoin and S&P 500 divergence echoes pre-COVID trends, potential realignment ahead

Quick Take
Bitcoin and the S&P 500 are currently diverging, a trend that has occurred before, most notably in 2019 leading into the COVID-19 pandemic. Back then, the S&P 500 rose from around 2,900 to 3,400, while Bitcoin fell from approximately $11,000 to below $10,000. This divergence began in June 2019, with both assets eventually converging after the market upheaval in March 2020.
2019 S&P 500 vs BTCUSD: (Source: TradingView)
The current divergence, which also started in June, mirrors past patterns where market stress, like the yen carry trade unwind, led to significant sell-offs similar to COVID-19. With Bitcoin and the S&P 500 reaching new all-time highs in March, the question now is whether Bitcoin will again realign with the S&P 500 as market conditions evolve. CryptoSlate has explored these dynamics, drawing on historical parallels to understand the potential trajectory of these assets.
2024 S&P 500 vs BTCUSD: (Source: TradingView)
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