Bitcoin Bullish Signal Emerges as S&P 500 Decouples
A new Bitcoin bullish signal has appeared, according to analyst Crypto Patel, amid an ongoing bear-market trend. He says BTC has formed its longest negative correlation with the S&P 500 since 2020, implying Bitcoin may be shifting away from “risk-asset” behavior.
The article also highlights a leverage reset: about 70,000 BTC in open interest was reportedly wiped out in a single liquidation event, clearing excess positioning back to levels seen around April 2025. Historically, the last time Bitcoin decoupled from the S&P 500, it was followed by a strong upside rally—so traders are watching for a similar pattern this cycle.
Price context: BTC recently rebounded back above $71,000 after briefly dipping near $68,000, though some market participants warn these moves can be “fake outs” in choppy conditions.
Not everyone agrees. Analyst Lyvo cautions traders not to turn overly bullish too quickly, noting retail sentiment may already have “priced in” a bear market after lower highs and continued declines. Still, Lyvo acknowledges a rebound is possible if selling pressure eases.
Longer-term, Crypto Patel forecasts BTC could reach $600,000 by 2029, using past-cycle behavior and citing possible accumulation zones around the $50,000–$35,000 Fibonacci retracement area. The next major cycle bottom is suggested for late 2026, with a peak potentially between $500,000 and $600,000 around Sep–Oct 2029.
Bullish
The article’s core claim is a Bitcoin bullish signal tied to two tradable regime indicators: (1) BTC’s correlation with the S&P 500 has turned deeply negative for the longest stretch since 2020, and (2) roughly 70,000 BTC in open interest was liquidated in a single event, which typically reduces leverage and can make subsequent price moves cleaner. Historically, the writer points to a similar decoupling episode being followed by a strong rally—so traders may interpret this as an early “regime shift” rather than a short-lived bounce.
Short-term, the upside case is supported by the leverage wipeout and the rebound back above $71,000, which often coincides with a reduction in forced selling pressure. However, the piece also includes a bearish counterpoint from Lyvo: after prolonged lower highs and a bearish narrative, sentiment can remain fragile, and rallies can fail (“fake outs”). That means follow-through may be choppy until correlation stabilizes and price holds above key resistance.
Long-term, the forecast (cycle bottom in late 2026 and a 2029 peak target) is scenario-based, not guaranteed. Still, if the decoupling hypothesis plays out, it could shift positioning from defensive to accumulation earlier than expected, improving risk appetite over weeks to months. Overall, the signal quality and the liquidation reset tilt the balance toward bullish despite near-term uncertainty.