Bitcoin has breached the $27,000 level for the first time this month. The rally came as Bitcoin’s correlation with gold and the stock market dropped. Currently, the correlation of Bitcoin with gold, Nasdaq Composite, and S&P 500 stands at -0.02, -0.06, and 0.18, respectively.
Bitcoin Price Breaks Above $27,000
On Monday, cryptocurrencies extended their rallies, with the leading cryptocurrency breaking over the $27,000 mark. Bitcoin increased by 3.7% to $27,418 on Monday before trimming some gains to fall below the psychological $27,000 level.
At the time of writing, the flagship cryptocurrency is trading at $27,167.90, largely flat over the past day. The coin is up by more than 4% over the past seven days and around 5% over the past month. However, it is still down by more than 60% compared to its all-time high of around $69,000 registered in November 2021.
The price gain comes ahead of the Federal Open Market Committee (FOMC) meeting, which will be held on September 19-20. During the meeting, the Federal Reserve expected to keep borrowing rates steady. Higher rates tend to reduce the allure of higher-risk assets such as cryptocurrencies.
“After a prolonged struggle at the psychological support of $25,000, Bitcoin held steady. Range traders will now be looking to take profits just above $30,000,” Mati Greenspan, chief executive officer of Quantum Economics, told Bloomberg.
However, some analysts have claimed that the rally might not last as there is no clear catalyst behind the price rise. Dessislava Ianeva, senior research analyst at Kaiko, said:
“I don’t see a clear catalyst for the move up. In the current low liquidity environment, relatively low buying/selling pressure could amplify spot price movements and spur liquidations on derivatives markets.”
Bitcoin Correlation to Gold, Equities Drop
The recent Bitcoin rally came as the coin’s correlation with gold and the stock market has dropped. According to data by The Block, the 30-day correlation between the top cryptocurrency and gold, Nasdaq Composite, and S&P 500 currently stands at -0.02, -0.06, and 0.18, respectively.
The indicator determines the correlation in the range between 1 and -1. If the result is very close to 1, they are highly correlated, while the opposite happens if it approaches -1.
The low correlation suggests that traditional assets are not influencing the crypto market. This marks a contrast from earlier this year when Bitcoin’s correlation to gold increased.
It is worth noting that the correlation between Bitcoin and equities appears to be cyclical. Data by The Block shows that Bitcoin’s correlation with gold dropped to as low as -0.84 in early July after reaching 0.73 in late 2023.
Nomura’s Laser Digital launches Bitcoin Fund
On a positive note to Bitcoin investors, Laser Digital Asset Management, a subsidiary of Nomura, has announced the launch of its Bitcoin Adoption Fund. The fund will allow institutional investors to gain exposure to Bitcoin with the highest risk management and compliance levels.
“Technology is a key driver of global economic growth and is transforming a large part of the economy from analogue to digital,” said Sebastien Guglietta, head of Laser Digital Asset Management. “Bitcoin is one of the enablers of this long-lasting transformational change.”
Laser will rely on Komainu, a regulated custody solution for institutional digital asset investors founded in 2018 by Nomura, Ledger, and Coinshares, to ensure the security of the fund’s assets. Nomura Holdings is a $500 billion financial giant that provides brokerage to leading intuitional investors.
Nevertheless, Bitcoin is trading at $27,167.90, essentially flat over the past day. The broader crypto market is also largely flat over the past 24 hours, with most altcoins registering less than 1% gains.
This article originally appeared on The Tokenist
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