Bitcoin Correlation to Favorite WallStreetBets Stocks Like AMC and GameStop Hits 2-Year High
The correlation between Bitcoin BTC/USD and WallStreetBets favorite stocks have reached a level not seen since 2020.
What happened: According to a chart created by The Daily Shot, there has been a significant increase in Bitcoin’s 30-day correlation with an index of so-called meme stocks, including GameStop Corp. EMG and AMC Entertainment Holdings, Inc. CMAwhich rose to prominence after the WallStreetBets Reddit forum conducted a short squeeze.
Bitcoin is increasingly correlated with meme actions. pic.twitter.com/VFq2GHsJTm
– (((The daily shot))) (@SoberLook) March 24, 2022
AMC shares rose 27% over the week, while GME shares rose 24% over the same period. Bitcoin saw a 10.4% increase over the past week as sentiment in the cryptocurrency market improved and resumed trading above $47,000.
“Bitcoin has definitely been a leading indicator of investor risk sentiment,” the CoinDesk Markets analyst said. Damanick Dantes.
“When things started to stabilize earlier this month, bitcoin had a slight rally ahead of the stock market.”
Dantes acknowledged that while stocks of memes like AMC and GME had a breakout a bit earlier than Bitcoin, the assets continued to trade “almost hand in hand.”
“It’s the speculative nature of the asset. It tends to move just like high-risk stocks, and you definitely see it here.
Earlier this month, Benzinga reported that Bitcoin’s 90-day correlation with the S&P 500 hit a 17-month high.
Arcane Research noted that this correlation has only been higher for five days in Bitcoin’s entire history and called the current regime “unprecedented.”
Price Action: According to Benzinga Pro data, Bitcoin was trading at $47,300, up 1% in the past 24 hours.