The analysis shows that when the correlation between the altcoins reaches +0.8 or above, the bitcoin price trend is likely to be reversed.

According to the latest report from Binance Research, the correlation between cryptocurrencies is largely due to market irrational behavior, similar to the “herd effect”. The report compares the average correlation of all altcoins (in addition to the top 10 stable currencies in US dollars) with the bitcoin price, and believes that as long as the correlation between these altcoins reaches +0.8 to +1.0, BTC/USD The trend will reverse, or at least stop the previous price action. However, the report pointed out that given the short history of cryptocurrencies, it is still too early to say that there is a causal relationship between the two.