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RE: Just Went x7 on my Credit Limit

in LeoFinance2 years ago

While I agree with you that BTC should decouple from stocks sometime in the future; your charts comparing the two are very misleading. For starters use the log scale and then of course you can also calculate the correlation coefficient which will give a pretty high score:

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And what good is this information?

Totally less than worthless data that leads to incorrect conclusions.

This data has been inherently manipulated in retrospect to make the correlation seem exponentially more extreme than it actually is. The scale on Bitcoin goes from 10k to 70k while the scale on Nasdaq goes from 8000 to 18000. Really? And even if it was perfectly correlated, still totally useless information as the stock market is just as random and unpredictable as anything else. Legit nothing to gain from this analysis.

Even by your own numbers the range in correlation goes from 0.9 to -0.60, so even by your own metrics these two assets are obviously uncorrelated. And then there's that section in 2020 that shows a high correlation even though the lines are totally off.

Honestly I thank you for this graph because it shows that Bitcoin is even more uncorrelated than I believed it to be. From -0.65 to +0.85 in three months? That is wild! I wonder how long it takes to get back into the negatives.