BTC–S&P 500 Correlation Turns Positive, 50% Downside Risk Signals

Bitcoin (BTC) is flashing a macro-driven sell signal as its link to US equities strengthens again. The article highlights that BTC’s 20-week rolling correlation with the S&P 500 has flipped from negative to positive, rising to around 0.13 from roughly -0.5. Since 2018, such a sharp rebound in BTC–SPX correlation has often preceded sizable drawdowns; the historical average points to about a -50% BTC move. On that basis, the implied downside target is near $34,350. Price action supports the risk-off framing: BTC/USD fell about 5.65% week-to-date to roughly $68,700, while the S&P 500 dropped around 1.90% over the same period. Macro headwinds—higher oil prices, inflation pressure, and lower odds of Federal Reserve rate cuts—are cited as factors that can keep BTC trading closer to broader risk assets. Flow/positioning is also cautious. Strategy (MSTR) did not report new BTC purchases via its STRC preferred-stock channel during the week, following its last buy on March 16 that added 22,337 BTC. For traders, the main implication is that BTC is becoming more sensitive to equity weakness, increasing the probability of deeper pullbacks if US stocks keep selling off.