Bitcoin Surges 29% Since April 2, Outpacing S&P 500's 7% Gain

Bitcoin has recently demonstrated resilience, rebounding more robustly than traditional stocks. Since April 2, Bitcoin (BTC) has surged by approximately 29%, while the S&P 500 has increased by 7%. This performance has ignited discussions about whether tariffs could be the catalyst for Bitcoin's decoupling from traditional markets.

The cryptocurrency market is currently exercising caution ahead of the second round of trade talks between the US and China. These discussions, scheduled to take place in London, will center on tariffs and the future of trade deals. The previous round of talks resulted in a 90-day tariff reduction, which led to a recovery in both the S&P 500 and the cryptocurrency market. However, recent accusations of violating the Geneva agreement by both parties have created uncertainty, potentially leading investors to cash out to avoid volatility.

Beyond trade talks, the upcoming US Consumer Price Index (CPI) data on Wednesday and inflation expectations data on Friday are expected to significantly impact the market. These data points could reflect the initial effects of Trump's tariffs, adding to the market's volatility.

Despite short-term tensions, global corporations continue to invest in Bitcoin. Strategy, a top company, hinted at a new purchase of Bitcoin, while MetaPlanet, a Japanese investment firm, announced plans to acquire 210,000 BTC by 2027. The Blockchain Group also signaled a similar strategy, aiming to become Europe's first Bitcoin treasury company.

On the technical front, Bitcoin is holding above $105,000 but faces short-term uncertainty. The daily chart shows a Doji candle, indicating indecision among traders. The Moving Average Convergence/Divergence (MACD) indicator suggests a potential buy signal, while the Relative Strength Index (RSI) maintains a sideways trend, indicating low momentum. A potential push below Saturday’s opening price at $104,288 could extend the correction to the 50-day Exponential Moving Average at $101,499. Conversely, a surge above the weekly high at $106,794 could target the all-time high of $111,980.

The broader cryptocurrency market is also watching the US-China negotiations for direction. The outcome of these talks, along with inflation data, will likely determine Bitcoin's short-term trajectory. While Bitcoin has benefited from growing risk appetite as markets recovered from April's tariff-driven volatility, the current geopolitical instability and bipartisan support for crypto legislation have also fueled its surge.

Bitcoin’s correlation to the Nasdaq Composite is currently 0.81, indicating a strong positive relationship. The crypto’s correlation with gold has recently moved negative, now sitting at -0.07. The “bitcoin is digital gold” narrative has certainly lost steam in recent years, with the cryptocurrency rising and falling along with risk appetites. Just look at what happened in April: BTC lost more than 11% the week after April 2. The S&P 500 shed 12%, and the Nasdaq Composite lost 13%.

Bitcoin often trades like a Big Tech stock: It’s high volatility and, at least in recent months, has not been insulated from macroeconomic moves. Big Tech companies are obviously more vulnerable to tariff policies, and we’ve seen that in the price action. Apple is down more than 17% year to date. Alphabet has lost more than 5% since the start of 2025. Bitcoin is up more than 16%.

Looking ahead, the eight biggest US tech stocks have seen an average downward earnings revision for Q2 of -5.9% (-2.2% if you exclude Tesla). Half of these names are currently underperforming the S&P year to date. It’s not too far-fetched to expect that BTC will continue to outperform these stocks, at least until the trade war settles down. With the second quarter nearing an end and few updates on trade deals, we’ll just have to wait and see.