Bitcoin Bear Market Shows Signs of Life as Stock Market Rally Supports Digital Asset
The Bitcoin bear market may be coming to an end, according to two key metrics that point to a reversal in fortunes for the digital asset. Since reaching its 52-week low on July 1 this year, Bitcoin has climbed by 47% (as of Sept. 23).
One reason for optimism is the performance of the stock market, which tends to average gains in October and November during midterm election years. This trend has been observed since 1950, with the S&P 500 index averaging gains of 3% and 2.7% in these months respectively.
The correlation between the stock market and Bitcoin is also worth noting. The two assets have a strong positive correlation over the past five years, meaning that whenever the stock market rises, it's more likely that Bitcoin will rise too.
Another key metric to watch is Bitcoin's 50-week moving average. On Sept. 20, Bitcoin climbed above this level, which has historically been a strong signal that the bear market cycle's low point is behind it.