The correlation of Bitcoin and Gold's daily returns is increasing causing investors to expect a further sharp increase in the price of BTC.
As the leading cryptocurrency rose to a 2020 high of $ 11,392 this week, its correlation with gold also increased. Currently, BTC's monthly correlation with Gold in daily returns lies at 0.66, according to data from CryptoCompare.
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Correlation begins to increase as Gold breaks past $ 1,900, close to a new high before correcting again with Bitcoin.
An increase in correlation represents a change in trend. Because in the past, the relationship between the two assets has always been decreasing, according to data from Kraken's research team.
While the correlation between Gold and Bitcoin has increased, at the same time the correlation between Ethereum and Bitcoin started to decline and is currently at 0.56.
According to some analysts, as the dollar and the economy continue to struggle to combat the crisis caused by the COVID-19 pandemic, it seems that the value of these assets is seen as 'shelters'. safe ”like Bitcoin and Gold will continue to soar due to high demand.