In my post from a few day ago “Iran, oil, and stocks: taking a victory lap,” I didn’t mention Bitcoin. It would appear I was wrong about so far about Bitcoin diverging from stocks. Bitcoin has done well, at $79,000 as of writing this, an increase of 21% since early April, tracking the stock market since the bottom. So I was wrong? This is once of those cases where I can be wrong in the short-term but have very high conviction of being right in the long-term. Zooming out, Bitcoin is repeating the same pattern as seen in the second half of 2025 and early 2026, in which it initially tracks the stocks market, only to fall inexplicably. The catalyst in 2025 for Bitcoin’s weakness was the realization there would be no bitcoin reserve. On August 14, 2025, Treasury Secretary Scott Bessent ruled out the possibility of taxpayer-funded Bitcoin purchases, and then reiterated this later in the year. Bitcoin was trading at $118k at the time, and after peaking at $125 in October 2026, it fell in…
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