A negative correlation between BTC and S&P does not mean that Bitcoin is gaining strength; This may reflect an isolated bounce alternating with weakness in the index.
Bitcoin’s short-term correlation with the S&P 500 has turned negative recently, but on-chain analyst Axel Adler Jr. warned in his morning brief on March 31 that this is not the bullish sign it may seem.
The most telling metric, the BTC/S&P price ratio, has been declining since the beginning of the year and continues to show that Bitcoin is underperforming stocks, inseparably from them.
Weak relative strength keeps Bitcoin tied to stock market pressures
Adler’s analysis focuses on two measures together paint A more complete picture of where Bitcoin stands in the current market. The first is the 13-week BTC-S&P correlation, which measures how closely the weekly returns of the two assets move together over a short period. This reading has recently turned negative, meaning the two assets have been moving less in sync.
On the face of it, this might indicate that Bitcoin is starting to trade independently of stocks. Adler retracts this interpretation. According to him, lower correlation only means that the synchronization of price movements is becoming less clean, not that Bitcoin is gaining strength. Isolated BTC bounces alternating with continued S&P weakness could lead to a negative correlation reading without the cryptocurrency performing better than stocks.
The second metric is the BTC/S&P price ratio, which is the most direct measure of relative performance. A high ratio means that Bitcoin is outperforming the index, while a low ratio means the opposite. According to Adler’s assessment, since January 2026, this ratio has declined significantly and has come under pressure in recent weeks. This means that even during periods when the short-term correlation broke down, Bitcoin did not turn into a safe-haven asset or achieve sustainable gains compared to stocks, the analyst said.
His conclusion was that the market is still pricing Bitcoin as a higher-risk asset with greater drawdown potential than the S&P 500. He also addressed what a true breakaway would look like, with the catalyst, according to him, not being a correlation reading but a sustained bullish reversal in the Bitcoin/S&P price ratio that would continue as a new stable system, not just for one week. Adler says that confirmation does not exist at the moment.
Price action and macro background
Bitcoin hit a monthly low of just under $65,000 earlier this week before recovering to exceed $68,000. There was unacceptable New developments in the US-Iranian conflict affected morale.
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At the time of writing, the asset is trading near $67,000, down 1.4% over the past 24 hours and around 6.5% over the past week. The worst performance was over 14 days, where Bitcoin lost almost 10% of its value, while it was quite the opposite over 30 days, where it remained almost flat, with only 0.3% in the red.
The geopolitical backdrop has added a layer of uncertainty that is difficult to model with oil prices climbing Nearly 50% since late February, driven by supply-side concerns linked to unrest in the Strait of Hormuz. Adler’s analysis suggests that Bitcoin is unlikely to escape the same appeal, regardless of what short-term correlation readings show, as long as the S&P 500 remains under pressure.
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