1. The Current Bitcoin Market Outlook
2. Retail and Institutional Adoption Trend
3. Extra Market data US stock Correlation

Bitcoin, the world’s biggest digital asset, has experienced a bearish divergence, leading crypto enthusiasts and analysts to speculate about a potential sell-off.

The Current Bitcoin Market Outlook

In a recent X post, renowned crypto analyst Ali Martinez shared a TradingView chart analyzing Bitcoin’s current movement. According to the analysis, Bitcoin has formed a bearish divergence against the RSI on the 4-hour chart. The Relative Strength Index (RSI) is a crucial metric that measures the pace and direction of a cryptocurrency’s recent price moves. The metric helps crypto traders identify market trends, overbought and oversold conditions, and potential reversals. A bearish divergence in the RSI occurs when the price of Bitcoin makes a higher high while the RSI makes a lower high. This could suggest a potential reversal or weakening momentum in BTC’s price. At the moment, Bitcoin is still enjoying gains that were registered last week. The leading digital asset was trading at $63,319, increasing by 0.8% in the past day and 8.2% in the past week. The trading volume spiked by 93% to $29.4 billion, suggesting increased investors’ interest. Bitcoin is now targeting the $64,000 mark, a crucial resistance level that could determine its future price movements.

Retail and Institutional Adoption Trend

The positive sentiments on the Bitcoin network can be attributed to contributions from both retail and institutional buyers. Retail investors continue to increase their adoption of the coin, as evidenced by the growing trading volume. At the same time, institutional investors continue to influence the Bitcoin market through their large coin holdings. A notable Bitcoin institutional investor is Michael Saylor’s MicroStrategy, which began accumulating the coin in 2020. The financial intelligence firm recently purchased BTC worth $458 million after raising $1.01 billion from an upsized Convertible Notes Offering. Notably, the spot Bitcoin Exchange-Traded Fund (ETF) market registered massive inflows last week. As per Farside Investors, Bitcoin spot ETFs witnessed a total net inflow of $192 million on Friday, September 20. Fidelity ETF FBTC dominated the market with a massive single-day net inflow of $26.1 million. Other notable players include Ark Invest, Bitwise, Grayscale Investments, VanEck, and Invesco.

Extra Market data US stock Correlation

Meanwhile, a correlation study shows US stocks and cryptocurrencies are moving more in tandem than they have at any time in the past. This indicates that the macroeconomic factors influencing equities also shape the crypto market. According to Bloomberg, the 40-day correlation coefficient between the S&P 500 Index and a measure of the largest 100 digital assets is currently at 0.67. A reading of 1 shows assets are moving in lockstep. On the other hand, an inverse tie is indicated by a reading of minus 1. It is still being determined if the recent BTC price drawdown is over. However, the market has been relatively stable for some days. Meanwhile, investors will be watching this week’s Fed officials’ commentary and the release of the Central Bank’s preferred measure of inflation – the Personal Consumption Expenditure (PCE) reading.

Bitcoin is in a phase of bearish divergence, causing market anxieties. Positive sentiments are supported by both retail and institutional investors, with significant inflows in the spot ETF market. The increased correlation between US stocks and cryptocurrencies complicates the forecasting of BTC's future movements.