Bitcoin may no longer be moving in lockstep with the S&P 500 over a short time frame, but that does not mean it has escaped the broader risk-off regime. In Axel Adler Jr.’s latest morning brief, the more important signal is not the breakdown in short-term correlation, but Bitcoin’s continued relative weakness against US equities.
Bitcoin Weakens Against The S&P 500
For that, Adler points to the second chart: the BTC/S&P price ratio. This is where the case for decoupling breaks down. The ratio, which tracks Bitcoin’s performance relative to the S&P 500, has declined since the start of the year and remains under pressure. In practical terms, that means Bitcoin has been underperforming stocks even during periods when the short-term correlation has weakened.
“What matters to the market here is not the fact of negative correlation per se, but whether it is accompanied by sustained BTC outperformance over the S&P,” Adler wrote. “That confirmation is not there yet, so it is too early to talk about Bitcoin achieving genuine independence from the risk-off regime.”
He makes the point even more explicitly in the note’s conclusion. “The market is currently sending an uncomfortable but fairly honest signal,” Adler wrote. “The S&P 500 continues to decline, and BTC is not merely staying vulnerable to external risk-off pressure – it continues to underperform the index in relative terms. The prevailing regime remains risk-off.”
In that framework, the more useful trigger to watch is not whether correlation stays negative for another week, but whether the BTC/S&P ratio can reverse and hold higher. Adler says only “a new stable regime” of relative outperformance would support a real decoupling thesis. Until then, the market message remains straightforward: the relationship between Bitcoin and equities may have become less linear, but not less risk-sensitive.
At press time, BTC traded at $66,652.
