Investing.com – The subject of the correlation between Bitcoin and stocks, especially technology, has been the subject of much ink in recent months, and has deconstructed the idea that Bitcoin could be a hedging asset decorrelated from markets in general .
And some even believe that following Bitcoin prices could help to better anticipate the price of stocks. This is particularly the case of Mark Mobius, who defended this idea during an interview with Bloomberg earlier this week.
“Cryptocurrencies are a measure of investor sentiment,” he said, explaining, “The drop, the day after the drop. That’s the pattern you get. It shows bitcoin is a leading indicator.”
It wasn’t until institutional and retail investors “really throw in the towel” and stop putting more money into the market due to losses that sentiment bottomed out, he said. “Now is the time to start buying stocks.”
As long as bitcoin investors are “still talking about buying low, that means there’s a sense of hope,” he said. “It also means we haven’t bottomed out in a bear market.”
Finally, Mobius told Bloomberg that it currently favors cash, but stands ready to invest in Indian stocks in the building materials, software and medical testing sectors.