Topic: When the US stock market goes down Bitcoin goes down (Read 1004 times)

This was much better than the trash Cointelegraph usually produces. Looks like there are still plenty of skeptics regarding the April-July bull run:




It's true that retail investors have played a significant role in the recent bull run. That's worrisome. The combination of so many retail bulls and horrible underlying economic fundamentals is straight up scary. I'm worried institutions are now selling into retail demand and positioning themselves to squeeze longs.

Should be an interesting couple months, that's for sure......

The US stock market isn't that big influence on the crypto market but of course, it somehow will affect the movement as well. We can see that it is a coincidence, not really for sure because what happens to the local stock market also drag the prices when it down. Things to see that the global market situation will be a huge factor that could affect the crypto market and many times it happens just like the crisis we have now.

We can bring Bitcoin prices to the high level if the economic situation will stay like this.
https://cointelegraph.com/news/3-reasons-why-bitcoin-price-could-crash-if-us-stock-market-collapses

I hope this could not create another drama but much better to be aware and prepared if ever this will happen.

It is obvious when an investor invest on both bitcoins and S&P500 then he may react to fundamentals in same way and may take similar decisions when something like covid19 outbreak happens or will invest more when he gets some bonus from this regular job. I guess correlation of bitcoin markets with US stock markets simply depicts us about the influence of both the markets by same set of investors and traders. I guess in near future, we might be having more correlated movements in bitcoin markets against US stocks as bitcoin markets already started attracting more traders and investors from there.

I guess bitcoin market is getting expanded due to its proven potential over the decade of time . When more people from wall street start admiring about the basic economic characters of bitcoins then we will have more stock based people into bitcoin ecosystem which will definitely lead to make market to react in same directions for any impacting news.

Trading is about the dollar and leverage thats why it all appears to be related, in extremes even gold because gold can be cashed and used to pay off leverage and margin calls.    So if we shock event, volatility, it usually relates to contraction and pullbacks, margin being paid.  I dont think BTC is related to SP500 especially outside of that dynamic but every part of the economy will appear to contract or expand.
   A good clue to this question would be to examine the volatility index and relate to prices of various assets also gold itself is considered a hedge against volatility as prices become less reliable day to day gold is more useful as a known quantifiable value over hundreds of years.
https://finance.yahoo.com/quote/VXX?p=VXX&.tsrc=fin-srch

I have seen many articles where there is a great correlation between the S & P500 and Bitcoin, and of course, when there is a fundamental one like the Covid-19 it affects the markets, even gold suffered a drop, and when the correlation is revised in the short term if it exists, everything changes when analyzed in the long term.

But to take into account, the Bitcoin market recovered much faster than the stock markets worldwide, hence it is concluded that it is not totally correlated, sometimes it can be taken as a mere coincidence that the movements depend on each other, but This is not really the case even though the global economy is one, when taking into account Bitcoin's deflationary economy it departs completely from the traditional one.

I just thinking that many countries out there which already categorizes bitcoin as a comodity so as they will make the same strategy like they use a strategy in stock market. Yeah I know the event, most of economic instrument were decreasing at that time. There is just one instrument that still consistent even its price is tend to increase namely gold. Many people think that gold is a safe heaven asset it means when many people believe that the stock market, crypto and etc will decrease because there is something bad happen they will their asset into gold and holding until the situation running well.

Bitcoin market price is just a pair of BTC/USD or BTC/USDT it is just they are pair so there is a change in the market price of the bitcoin but at the end of the day, there are no real changes in terms of the bitcoin it is just a still a bitcoin when you buy one (1) BTC at the end of the day even the market price of the bitcoin falls down still you have one(1) BTC. Many people are trying to say that the market price of the bitcoin falls down but this is not real.


Some of the people today are making an investment with the use of bitcoin because this is the new safe haven right now because the economy of the different countries and one of the best ways to make an income is to make an investment with the use of the bitcoin.

Some investors may get triggered to sell their crypto assets whenever they see downfall in the stocks but it is not really meant to happen since crypto assets are way better than stock market investment so getting signals from stocks makes them to lose their money on most of the occasions.

In my opinion it's just a coincidence, because if we study the movement of the stock market with bitcoin is much different. Maybe that happened
in March 2020 due to the Corona virus Outbreak that caused investors to panic and make all investments go down, not just the stock market
and bitcoin only. Even gold and real estate investment when it came down too. What happened in June is also the same.

When Dollar index is rising it means the exchange rates of most currencies are then buying less dollars per their own national units.    If countries, companies or people owe dollar, have debt or leveraged accounts in that unit then they become dramatically worse off at that point as both market and positions can move against them.     BTC as it trades and is easily exchangeable in dollars is a possible source of dollars for those who owe this debt, hence even if BTC had previously been wanted and had no problem within its own sector it will still become under pressure as a funding source of dollars.    Its not as true within the USA where of course dollar is the only currency commonly used but most countries around the world also have dollar as their reserve asset and source of liquidity when trading especially globally, so its a receding tide for economies outside the normal circulation of dollar liquidity.
   We have foreign nationals investing in US stock market and we have global usage of BTC also, you can have any currency linked to an asset price in theory but the biggest markets are for dollar pricing at present.   Hence I think the two are linked in this way, its also possible for a foreign company to owe dollars in taxes and tariffs yet have no natural source, if dollar rises and perhaps they receive less orders also their profits are impacted twice over.
 I think the explanation for carry trade in investing dictionary could help explain some dynamics better https://www.investopedia.com/terms/c/currencycarrytrade.asp

This could be the case in the future if investors begin to see bitcoin as a store of value but it seems we are not there yet, investors see bitcoin as a highly speculative asset and as long as this is the case then whenever the stock market goes down significantly we may see an eventual movement in the same direction of this market, many do not like this but to me this is a transitional phase of bitcoin and there is nothing to worry as long as the development of bitcoin continues and fiat keeps losing value.

We thought for a long time that Bitcoin is not correlated to the classic stock market - that it is an asymmetric asset, but more and more we see, that it is really correlated. Simply, when investors are afraid, they do not invest, but when they see an opportunity they buy. And it doesn´t matter what asset it is at the end if it is crypto, oil, precious metals, or stocks. It is either a rising trend or a declining trend.

This isn't really true, it only has a small impact on the cryptocurrency market. Why is bitcoin price in 2017 so high? Was the US stock market also similar at that time? And then how does bitcoin fall free?

Bitcoin is not correlated with the US stock market, you can see the difference, yes bitcoin dropped at the price you mentioned but it rises back again. In fact, it reached $10K days before the halving if I am not mistaken and now bitcoin is already trading above $9k.

You can see that there's a big difference, the US stocks continues to struggle while bitcoin is quite stable already.

Maybe the initial effect was not good for bitcoin due to panic, but then it slowly recovers and we are seeing it's good price now.

Not quite true! Every market is affected by the global economy! There's no particular national economy that can affect all of the markets even the U.S or China. Also, there's no statistic that proves the U.S has the largest number of crypto-traders not to mention a lot of traders in other countries registered as U.S citizens (fake info). Therefore, it's not accurate to say that all market depends on the U.S economy.

Dollar is a funding currency, its one of the most liquid largest and cheapest market traded currencies in the world.    What will happen is money is borrowed in dollars to buy various goods, even including BTC.   When sentiment turns and market pulls back the dollars that sold come back to repay the debt and settle the trade hopefully for a profit.    Theres usually a rush for that to happen in any proper sell because so much money is borrowed it causes a great wave to close out fast and first not to be the last to spot the tide change and get wet.
   The way this is most obvious is by difference in currency interest rates, if say I borrow Australian dollars and they had a 5% interest then I must pay that on top of my fees.   To go borrow AUD and go long USD would pay poorly unless the move to loss of value for AUD was greater, quite certain to the trader.  Its part of why a central bank raises rates to stop their currency falling too low, raising import costs.    The reverse however is happening, USD is very cheap to take on account and spend and then I simply go deposit this in AUD and gain my 5% a year so Im very happy so long as the sun shines and we expand or believe Australia will expand.   Same for BTC, it rushes up and people sell dollar to come to crypto and vice versa they'll run like the wind to close and sell out.
   Similarly stocks, when markets fall alot of the effect is hot money borrowed from easy money regimes and Dollar is the biggest of all.  Thats why we get correlation, its harder to tell which sector performance can stick and grow its revenue, business.     BTC has no yield but its also hard to mine, its not a funding currency for other ventures really.

It depends which stocks you look at. The NASDAQ 100 index recovered even closer to its yearly highs than BTC did, 0.3% vs. 0.9%. Some stock sectors are obviously recovering much better than others. Tech, biotech, e-commerce, and a few others have made huge gains while others are still in the dumps. I think we should take a more holistic approach when making these comparisons.


They've been looking almost the same for 4 months now. The only real difference is the magnitude of volatility.

Bitcoin was looking good after the first Covid dip because it recovered much better than stocks. There were even opinions that it's going to be like gold and rise when stocks are falling.

The second dip is looking much worse with Bitcoin and S&P 500 looking almost the same.

It's still better to hold Bitcoin than stocks though because it dips and recovers faster but I'll admit that I was expecting a slightly better performance.

I think right now every market runs according to US market.One reason is it is the largest market financially with companies registered globally and people invest in them from all around the world.Secondly US has the largest number of crypto traders and if there financial condition is not good than they will withdraw or sell their investment.

If the stock market is neutral to bullish, the correlation tends to fall. When the stock market is bearish the correlation increases; they fall together and recover together.

It's a very similar dynamic to BTC vs. altcoins. When BTCUSD is neutral to bullish (and especially sideways ranging) altcoins are free to pump independently of it. On the other hand when BTCUSD is in a bear market, altcoins are undoubtedly in a bear market too.

All of this suggests to me that the correlation is derived from the fact that stocks, BTC, and altcoins are all viewed by investors as risk assets to differing degrees.

Despite being called an uncorrelated asset, Bitcoin is frequently correlated with traditional markets when there is a significant price movements and change in sentiment, such as during a pump or crash.

Between these periods, Bitcoin can largely be considered uncorrelated, since it tends to move in a way that cant be predicted from the equities, bonds or commodity markets.

When stocks drop that doesn't always means that there is money going out, not at least as much as you think there is because when someone wants to sell their stock and there is no buyers the price drops, as you can see nobody bought a single stock and nobody has any money in that situation, the price dropped just because nobody was willing to buy for that price and it had to drop.

Now, there is of course some money in bank accounts in fiat form instead of stocks after a big drop most of the time but not as much as you think. And one of the reasons why they are in cash form is the simple fact that people didn't wanted to be invested and wanted to be in cash just in case and wanted to make sure their money is not gone. Putting it in bitcoin doesn't really change that and wouldn't really help them at all.

This trend is just a recent trend and previously the reverse used to happen a lot of times. When the stock market used to fall there was always an increase in price of bitcoin and when the Chinese stock market used to fall some points then the bitcoin also used to loose its value but now this trend is changed. The same happened when the lockdowns were being announced around the world and Corona virus was declared as a pandemic but the recent fall didn't had any reason behind it.

According to studies of the coinbase cryptocurrency exchange, the cryptocurrency market does not have any dependence on the stock market, but nevertheless, today there is a certain connection between Bitcoin and the stock market, which first began to appear even in almost 2016. This is primarily due to the correlation between gold and Bitcoin. This connection was especially noticeable at first in 2019, when economic problems began to rise, which were accompanied by an intensification of the tense political situation in the world. And already in 2020, due to the spread of coronavirus, this situation is most palpable and is exacerbated very actively.

That's their way of surviving this pandemic, they do panic selling in order to buy their necessities as this quarantine really cause inconvenience to all of us. US stock market affects the bitcoin's price so much that if it goes down, bitcoin will also go down. Bitcoin's value is what we need right now to buy food for our family, but if you have some spare amount of money that you can use for your budget, then there's no need for you to do panic selling. Instead, you will still wait for the economy to become in a better state where bitcoin's price will improve and also the US stock market. This pandemic is not a long-term suffering. I believe that bitcoin will save us soon.

The first that happened during the first wave of the pandemic was the caused of the corona virus, which hit so hard on the world economic and causes the investors to fear the downtrends of the market. Investors want to see their portfolios growing and not in negative, this gave them the mind to sell off their investment. The recent downtrends was the fear of the second wave of the pandemic, at this time investors are more afraid to lose like the first wave. Either the cryptocurrency or stock investors, they are all afraid of loses.

Perhaps it was due to the Covid-19 that is still up in the air (no pun intended). What I mean is that investors are still reluctant to invest to neither traditional stocks or crypto. That's why when there are negative news, both market crashes and investors are not moving their funds anymore.

So there is a tiny bit of correlation, unless everything has settled down and investors are willing to play in both markets again.

I think most of the investors stop investing because they know that the stock market goes down,crypto market will go down too because most of the people are lack of financial. Investors will also think that many people are not capable to invest and trade that's why they think that because stock market is down,they are going to panic selling  which could lower the price of crypto.

The Crypto market is something correlated to the global stock market. Thus, the US stock market is a huge market player and that it has a big influence on the market trend. Besides, we all dump so hard at this time since we are still facing the pandemic. It probably investors will wait for the market to replenish and they'll turn back to crypto investment well. What they have in their mind today is to combat the crisis and that investing will commence later. It is so much to have a huge impact on Bitcoin's price and see the declining sentiments than driving it high.

That is what we have today. It holds the market to soar high and it takes the level below $10k.

yes that is true. bitcoin follow stocks, but it should not be like that. when stocks falls money should flow into bitcoin

If the US stock market goes down, maybe that gives effect to the bitcoin market. I think it provides psychology with an effect on the trader, and they think that the stock market and bitcoin market will be related. So when the US stock market down, the trader will cash out their money while also waiting for another time to buy at a low price. It can give the effect to the bitcoin market, in which traders watch what is going on with the stock market.

Crypto market is a market that is not controlled by anyone, so it will definitely not affect the global economy. I think Bitcoin's decline is often due to panic psychology when reading a piece of bad news about the market. In general, there is no exact comparison between both the stock market and crypto market because each market has its way of operation and different volatility.

That is really not true at all.

BTC and stocks correlate well historically. You can confirm this by using an asset correlation calculator. Comparing BTCUSD with SPY or DJI over its 10 year history reveals very strong correlation above 0.8. You can also confirm this visually by overlaying charts.

More importantly, the markets are moving in lockstep now.


The two are correlated. The point is they are moving together and will likely continue doing so.

I disagree, what do we use to measure the value of a bitcoin? Fiat, right? Which means that bitcoin is part of the economic system whether we like it or not, the truth is that as bitcoin becomes more popular and institutional investors become interested in this market to the point of investing in it then it makes sense for bitcoin to move in a similar way to other markets, after all if the stock market goes down even if this is unrelated to bitcoin the investors that have put their money in both markets will probably sell their bitcoin to cover their losses in the stock market making the price of bitcoin to go down as a result.

it IS a coincidence because it only happened ONCE and never before and never after.
if anything bitcoin is following the pandemic and world economy in general as people lost their income, some lost their job, and a large percentage lost a lot of money. THAT affected everything including stock market, bitcoin market, oil market, gold market,.... bitcoin is still not following stock market.

Nothing will happen to the economy because bitcoin is not apart of the economic system. The only thing is when it does crash those that invested in bitcoin will lose their investment. Bitcoin Price Drop to $8.9K Raises Fear of a New Bear Trend Beginning. Traders fear Bitcoin could be entering a new bearish trend after the price dropped below $9,000 earlier today.

Proper manipulation of your assets is the key to minimize the effect of crash to your bitcoin. Stock markets are vulnerable every time and their are a lot of factors that can trigger it, including the trading volume. You should know when to invest in bitcoin so that you will not suffer when stock market will go down.

Bitcoin is still a part of economic system as it brings some advantages and disadvantages in the market. Not only stock markets are affected, physical assets and other valuable things are also affected that's why the market depends on the people who actually operate and contribute to the activities in the market.

The price hasn't dropped much when compared to the price of stock. Usually people expect the opposite to happen (and I think the opposite thing does happen). When the stock starts to fall, people starts withdrawing their investment and then starts investing on bitcoin causing the price of bitcoin to increase.
This year was a bit exceptional though. The stock and the price of BTC followed, and this was due to people panicking.

The price changes we talk about usually take place in almost the same process, so it is difficult to predict which one will take place earlier. Moreover, since the changes we mentioned are instantly following each other, it is not even possible to make an assessment in case of a possible forecast. In general, all we can do is to anticipate bad market conditions and arrange our transactions in accordance with these conditions. However, we can analyze such decline situations in advance and evaluate these opportunities.

Bitcoin became this corporations commodity thing few years ago. I don't know when it first happened but it wasn't really slowly going up thing, it was a sudden thing. Maybe it was the 2017 December peak when they saw that $20k or maybe some time later or before?

Maybe they were the ones that made it $20k to begin with? I am not really sure but all those wall street type companies (not just wall street as a location but the idea) all got interested in bitcoin and that caused a correlation between stock market and bitcoin. Before that we were independent and different, after that it is all them, when they sell their stocks because of a crash they sell their coins too, when they buy stocks for profit they buy bitcoin too, it became too attached to each other because of them.

Nope! Disagree.

The whole US economy is in crisis and so as to poor stock performance, and wait a minute bitcoin stands still 9K+ USD. I believe that is just a wave that occured for few times but it never relies on the stocks. I think we already had such discussion before and it point outs that this is indirect relation so sometimes it affects the crypto severely and other times it doesn't even move it a bit.

My disagreement is to the US stock thingie! I mean bitcoin is decentralised commodity and whole world trades it. It's like you comparing whole US market with rest of the world. That's lame.

One way or another, the cryptocurrency market and the stock market are very dependent on each other, because they are affected by the influence of competition, especially recently, when the cryptocurrency market is increasingly attracting investments, as well as potential participants in the stock market. but this is not the only factor because of which Bitcoin always reacts to the stock market.
and since another crisis is strangling the global economy today, the stock market and the cryptocurrency market also suffer from this. Although, according to experts, the cryptocurrency market copes much better with the consequences of the economic crisis.

I am also watching bitcoin market is reacting in complete opposite direction of how USA stock markets are doing. Before this, I have observed bitcoin and gold are sailing on same direction most of the time but this time, gold is staying strong but  bitcoin is still remaining range bounded which could be the reason investors are getting panic when the US market is not doing good. Overall we can say they cannot be one permanent trend for bitcoin markets.

In last 6 years gold did not show any big movements but bitcoin approximately gained 10 times growth in that same time frame. So, we cannot say bitcoin is falling into the category of alternative investment like gold. Gold and US stocks are known for reciprocally related but bitcoin is not having anything like that as of now, it seems.  

It does affect the market of bitcoin.

But there is a question here.
How will you know which goes first?
Bitcoin market could go down anytime because of volatility. Will that mean the stock market will do so, afterward?

This might happen at times but this is not the case every time.
Both the markets are independent of each other and it's just the investors perception over the market that makes him to take out the investment from both the markets at the same time. This is not at the case with all people and this is why many times I have seen both the markets going in opposite direction.
Also, you will find very less instances when the US stock market and bitcoin increased together.
Both the markets behave in a different way at different times.

It is a good sign in some sense. Because this crypto space is having traders and and investors from Wall street and from other institutional fund managing houses. When a trader see a downfall on stocks they may react on everywhere regardless of the individual potential of different assets. This is just an assumption based on what happened some 3 to 4 years back and what is happening on crypto space against stock's movements.

People do call gold and silver as alternative instruments for stocks but I have seen gold prices are following index of big exchanges. It means when one or two stocks fall and rise that may not impact gold prices but when overall stock market index is fluctuating then gold prices do follows it.

When traders understand the ecosystem of bitcoins like its impacting and influencing factors then they not follow the same trend of stocks; they may switch to bitcoin when stocks not doing good and vice versa. But, when treat bitcoins similar to just another stock/ trading asset then experiencing same fluctuations of stocks may remain inevitable. But, it seems those institutional traders are having complete different approach on gold which must be the reason gold remains unaffected of US stocks.

The reason that there is a panic selling mood is because bitcoin is closeky tied to USD, my currency is basing its bitcoin prices on the value of USD, I do not think that it is something that we should worry about because markets bounce back and there will always be people that will be investing, just be thankful that bitcoin does not collapse, we are focusing too much on the problems that do not involve bitcoin too much.

That suggests short term correlation among all those markets. It doesn't suggest the drop was a random occurrence.

The Dow and S&P 500 actually have decent long term correlation with BTC. I have no idea why people try to assert there is no relationship at all. Just overlay the charts.


You can only call it a "coincidence" when something happens once or twice. BTCUSD and the S&P 500 are nearly identical from mid-February to present. For the last week as the stock market threatened to crash, BTC followed in lockstep, and also recovered in lockstep.

In my opinion it's obvious that if stocks go in the shitter, so will BTC.

It was a panicked selling mood. is understandable because this is when the epidemic began to spread so people will not need to hold financial assets anymore. they will sell for a lot of cash so they can buy food. That is why when there is instability in the economy out there, the financial market will fluctuate so strongly. We are also investors and Bitcoin is just a financial asset, it will not escape panic selling.

It's true! In the cryptocurrency market, it's considered "good" when you can predict 80%. That's such a high percentage of prediction! The stock market and the cryptocurrency market seem not the same as each other. However, they are all affected by the global economy! The cryptocurrency market is also harmed by the pandemic COVID-19 despite the fact that the pandemic gives people a chance to explore the cryptocurrency world!

Stock markets and bitcoin or crypto-currency markets isn't related each other directly. But sometimes we might notice stock markets impacts on bitcoin price. Its probably due to panic, who know if investors are investing on both platforms. I believe bitcoin isn't out of global economic system, so when a part from global economy dumped then it would effect to other but not always.

I am not agree with you, I believe bitcoin is a part of global economic system since we are investing on it. Aren't all investors are a part of global economy and backed bitcoin by themselves. Actually we aren't losing bitcoin anyhow, just losing if you consider against USD inacese price dump. If you bought 1 bitcoin it will ever with you, we might say we are buying bitcoin instead of investing on bitcoin since there is no such as ROI platform.

You shouldnt really correlate Stock and Crypto market yet they do move in different way.There might be instances that they move out on the same manner but doesnt mean that
they are already connected.

If you do this for fundamental analysis then im sure that you would commit mistakes from time to time.As a trader, i didnt recognize this kind of correlation - maybe in some aspect or situation
but im not relying into these infos.

Always stick out on news that hovering on crypto space rather than minding yourself into other markets.

You would think the institutional investors wouldn't dump their holdings when stocks dump. So that the world would see that bitcoin is not closely correlated with stocks in order for people to believe that, and buy bitcoin as a hedge. Unless they want everyone to believe they are correlated so they can buy back cheaper. There is some sort of manipulation going on there it doesn't make sense

This is actually something related to investor psychology. While all world markets are declining, the decline of crypto money markets will be somewhat abnormal. That is why world markets and the United States stock exchanges in general decline, while the value of Bitcoin and other cryptocurrencies declines. The main reason for this, as you mentioned, is the investor psychology. It is quite normal for Bitcoin and other cryptocurrencies to drop in price as long as cash is appreciated. For this reason, prices decline in all world markets, while crypto markets follow these markets.

That was exactly the opposite back in the day, when the us stock market went down the bitcoin market went up. The reason why this used to be like that and why it changed is both a good one but also a sad one at the same time. It used to be like that because there was no wall street type of investment people around, most of us were here because of the tech and we love tech but also we hate banks and we hate governments trying to control everyone as well.

It changed because eventually wall street people started to go into bitcoin world and started to buy in billions which is good because price moved up a lot but at the same time sad because now we are working together with the people we hated and started this. In any case now because of them being here they move according to us stock markets and that affects bitcoin as well.

Despite the fact that digital coins are often credited with the status of a protective asset, during a period of panic and mass sales in the market, they fall along with everything. Both markets - crypto and stock - are showing a fall after Trump's announcement of new sanctions against China. In addition, the United States is afraid of the second wave of coronavirus, which also causes panic among investors and affects exchange rate fluctuations. Also the rate of price decline indicates that the initial downward movement was strengthened by cascading liquidation of long positions on cryptocurrency exchanges.

I see it as just a matter of two things happening same day. The price of bitcoin has been falling after it got to $10,000. Bitcoin dropped last week Wednesday from $9,700 to almost $9100 and then got back up to $9,500 same day if I'm right. So I think I'm not linking it to stock market.

we can not make that conclusion because we don't have enough evidence to support that.

the only thing that has happened over the past 11 years is that this year after all this time we had a very gigantic drop in stock market and a lot of other markets then bitcoin dropped too.

looking at today's price i don't see any different trend than the past 2 months starting from April. there is ups and downs with an overall rise and right now we are stuck in this price level. we had the rise for the first 10 days of June where price reached $9999 till June 10-11 and then it reversed down and price reached $9000 today. then it will reverse back up and reach $9999 again .... this will go on until a breakout happens and we reach $12k.

now if another market coincidentally dropped while bitcoin was doing its own thing you can't call that "bitcoin following that market"!

You always have to keep in mind that trading, whether in stocks or in the Crytpo market, is highly automated and mostly done by bots (I'm not talking about private trading bots when someone installs Gecko on a Raspberry Pi ).
These bots react to the smallest signals in the respective markets and try to sell shares as fast as possible or to buy them when the trend is positive.

I assume that the bots today are on the move in many markets at the same time and trade the same way. If a bot sells shares because the Dow Jones falls, crypto assets are also sold - and vice versa. So the markets have nothing to do with each other per se, but once they are used by the same buyers and sellers, their actions and reactions are similar/identical.

More like a coincidence. There is no direct relation the crypto market into US stocks perhaps this is just a dejavu. Stocks are more prone to going down while bitcoin is noted as volatile speculative asset which point down to its up and down. Not really shocked with this price drop.

Also if we check the charts you can noticed that the trwns line for bearish has been break so there is no point comparing to stock as the result have been predicted already.

Let's get one thing straight, there is little evidence to suggest correlation between the stock market prices and the crypto market changes. What you saw and described above is coincidence as we all know how volatile the crypto market is and any news might tilt the market direction.

The stock market does not dictate the crypto market and unlike its distant relative is obviously stable. What might be happening is investors' loss of appetite for risk which might determine how these investors look at a less stable market such as crypto when the supposedly stable, stock market saw a downfall.

I agree with you. Investor sentiment is still very worried, and during the past few months, the stock market has continuously suffered a new collapse. I think COVID-19 has ruined the entire world economy and may take a long time to recover. I never expected this to happen because it affected my current job, and now I only have a way to trade to earn a little money to make ends meet.

The global stock markets were down because of the expectations of a second wave of the coronavirus pandemic.The crypto markets shared the same fear.Basically the greed and optimism returned on both the crypto and stock markets during the last 2 months,caused by the slow recovery and removal of the lockdowns.
Now all that optimism about a fast economic and financial recovery might disappear.
The "mood of the trader" right now is just uncertainty (if we can call this mood).

The stock market and the cryptocurrency market are both affected by the economy of the world, but the cryptocurrency market does not show such a strong dependence, as it is characterized by supply and demand, often based on the emotions and expectations of traders. Cryptocurrencies do not have a material foundation, so the "external" news will not affect the cryptocurrency market as directly as the stock exchanges.

Agree! All of the markets are affected directly by the economy. Especially in the pandemic, the economy of the world is hardly increasing. Therefore, cryptocurrency market is not an exception, it also decreases! It's not too surprised though!

Bitcoin is not apart of the economic system. The only thing is when it does crash those that invested in bitcoin will lose their investment. If the stock market crashes, that usually means unemployment rises, and if you don't have a job, you won't be able to make your payments.  When stock markets crash, investors usually move their money to the Bond Markets until stability returns to the Stock Market.

Basically, it's just the common reaction of investors. When the world's economy is at risk of not gaining but recessing, investors seem to hold their investment rather than investing in any kind of project. It doesn't matter whether it is the stock market or the cryptocurrency market, investors still do the same thing. Personally, I think the stock market and the cryptocurrency market hardly have anything in common that can affect the other. However, they are all affected by the economy of the world!

Today, the US stock future goes down near 900 points then the bitcoin prices goes down too.  It happened the same in March 2020 when the US stock market goes down then Bitcoin goes down $4500.  Any one knows the psychology or the mood of the trader?  Thanks.