Is Bitcoin trying to shock everyone? A branch with stocks may fuel the next bullish run

Bitcoin is on a downtrend after its new all-time high in mid-August. This decline is in stark contrast to the rise in stocks and gold prices.

However, these differences reinforce the case that the crypto market could soon be set in a bullish catch-up rally.

The perfect set up for a surprise rally?

In its latest analysis, Crypto Analytic Platform Santiment details the prominent bullish divergence that has been formed between Bitcoin and the traditional market over the past two weeks. Since August 22, BTC has dropped 5.9% as it temporarily reached $107.5k before it recovered moderately. During the same period, the S&P 500 rose 0.4% and gold rose 5.5%.

Since early 2022, crypto assets have shown a strong correlation with stocks as they have been placed by institutional investors along with stocks. This makes the current split abnormal, as Bitcoin is lagging behind both stocks and gold despite its upward movement.

According to Santiment, such persistent differences have often been set in such a way that Bitcoin and altcoin “catch up” with global market trends. The larger the gap between BTC and traditional assets, the more attractive it becomes due to potential crypto rebounds. This means that traders need to monitor closely for recovery.

Bitcoin breakout conditions

In another analysis, Matrixport said Bitcoin’s current calmness will not last long. This level is currently being tested and has been identified as bearish changes in trend models.

However, Matrixport said that zones like these rarely give way in their first attempts, adding that while there remains a downside risk, the current integration could also serve as the basis for the next big move. The background is specifically told, as evident from the rapid accelerating US debt issuance under stress in the European bond market.

At the same time, Bitcoin’s funding rate cooled down and the stacked macrocatalysts of the year collapsed into a historic bass. The options market appears to be low prices for potential volatility, creating conditions for traders to be caught off guard. Historically, this magnitude decline has often set strong rebounds.