Bitcoin Price and Google Trends: A Correlation?
Bitcoin’s price and search scores on Google Trends often go hand in hand. When there is increased market interest in the leading cryptocurrency, both the price and the number of searches for ‘Bitcoin’ on Google tend to rise.
In the past two years, Bitcoin has been on a downward trend, dropping from a high of $69,000 in November 2021 to a low of $15,400 per BTC in November 2022. Currently, Bitcoin is trading within a consolidation range of $24,700 to $31,800 since March 2023.
Despite the recovery in price over the past year and the historical correlation between Bitcoin’s performance and Google Trends, the search score for ‘Bitcoin’ has reached new lows, resembling the levels of interest seen in 2020.
According to data from Google’s platform retrieved by Finbold, the current week’s search score is 14. It’s worth noting that the week is not yet finished, so this score may increase by October 14.
Lowest Search Scores Since 2020
In the previous week, the search scores were already as low as those seen in October 2020. Interestingly, the highest score of 100 was reached in May 2021.
Will Bitcoin Price Follow Google Trends?
Typically, Bitcoin’s price and Google Trends’ scores move in the same direction. However, divergences between the two metrics can indicate a trend reversal for one of them.
In 2020, Bitcoin’s price was on an upward trend while Google’s scores were declining. This divergence marked the start of a bull market cycle that lasted until March 2021.
An interesting divergence occurred at Bitcoin’s all-time high in November 2021, with a low score of 36 on Google Trends. This bearish divergence led to a price decline, and the correlation between Bitcoin interest and search scores has continued to drop.
In the current context, it is possible that there is another divergence with low interest but a slightly growing perception of Bitcoin’s value. However, the market is still consolidating, and there is no consensus on Bitcoin’s next moves.
Some technical analysts suggest building momentum for BTC based on the 4-hour RSI, while macro strategists believe Bitcoin could lead a “great reset” in line with other commodities. Additionally, there has been a surge in searches for ‘buy Bitcoin’ on Google Trends, indicating increasing demand for the cryptocurrency in the spot market.
Hot Take: The Uncertain Relationship Between Bitcoin Price and Google Trends
The relationship between Bitcoin’s price and Google Trends is not always straightforward. While they often move together, divergences can occur, leading to trend reversals. Currently, despite the low search scores for ‘Bitcoin,’ the cryptocurrency’s perceived value seems to be slowly growing. However, the market remains uncertain, and there are differing opinions on Bitcoin’s future trajectory. Technical analysts see potential momentum building, while macro strategists anticipate a reset following other commodities. The recent surge in searches for ‘buy Bitcoin’ may also contribute to increased demand. Ultimately, only time will tell how these factors will influence Bitcoin’s price in relation to Google Trends.
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