This week has been remarkably turbulent, yet one indicator could be hinting at a prevailing long-term optimism for bitcoin.
The decline in stock markets began on April 3, driven by uncertainties surrounding tariffs from President Donald Trump. Each subsequent day has witnessed significant fluctuations in both directions. This wave of anxiety has impacted both stock and bond markets, while gold prices have reached record highs, and the DXY Index has fallen below 100 for the first time since July 2023.
In reaction, the S&P Volatility Index (VIX)—frequently referred to as Wall Street’s “fear gauge”—has climbed to its peak since August of last year, which introduces a fascinating angle for bitcoin.
The bitcoin to VIX ratio currently stands at 1,903, aligning with a long-term trendline that last appeared during market fluctuations related to the unwinding of the yen carry trade, when bitcoin bottomed out around $49,000.
This marks the fourth instance that this ratio has reached the trendline and subsequently found a low point. The previous occurrences happened in March 2020 during the height of the COVID-19 crisis and initially in August 2015, both followed by significant price increases.
If this trendline continues as a reliable support level, it may indicate that bitcoin has once again identified a long-term bottom.
Read more: Bitcoin’s Recent Drawdown Proves Its More Than Just a Leveraged Tech Play