It Won't Be Pretty...
Investors,
Since mid-2022, I’ve been sharing an extremely important correlation between Bitcoin and the multi-billion dollar semiconductor company, Micron Technologies $MU. To date, this is the best single-stock correlation that I’ve found for Bitcoin over the long-term — showing a tight correlation of local tops/bottoms since Q1 2016:
While the magnitudes of their respective moves are different, the directional relationship is extremely clear. No correlation is perfect, but this is easily the best one I’ve come across in my research. If we zoom in and analyze the correlation since the COVID lows in March 2020, we see the following:
The melt-up from March 2020 - Q1 2021 occurred in near-perfect lockstep, with both assets reaching new ATH’s & peaking simultaneously. The correlation weakened in Q3 2021, but the selloff in 2022 affected both similarly. As we look at price action in 2023, I’m noticing an interesting deviation over the past several weeks:
Bitcoin is trending sideways
Micron is declining
This relationship will be extremely important to monitor in the weeks/months ahead, as bulls will likely want to see both assets participate in upside together. In the remainder of this premium report, we’ll focus specifically on equity risk premium and Q2 2023 earnings dynamics. As a reminder to all premium members, I’ve sent out invitations for the Premium Group Call on Tuesday so please be sure to RSVP. For free subscribers, please consider upgrading your subscription to attend the meeting!