Lumber to gold ratio breaks down, suggesting a risk-off environment
- So far, 2023 has been a good year for Bitcoin and risk assets, with Bitcoin up 71%, Nvidia up 92% and Meta up 68%.
- The S&P 500 is up 7% and the Nasdaq is up 20%.
- But the timber-to-gold ratio points to a risk-off environment, and the stock market always follows a crash.
Highlighted are the areas where the wood-to-gold ratio collapsed and the S&P 500 subsequently fell.
- 1987 Crash
- 1990 bear market
- 2000 tech bubble
- 2008 Lehman Shock
- Summer Crash 2011
- 2018 4Q correction
- 2020 Covid Crash
This could mean further headwinds for Bitcoin as it correlates to some extent with the US stock market.
The wood-to-gold ratio has collapsed, suggesting that the risk-off environment first appeared on CryptoSlate.