Definition
#Pearson correlation between this coin's 1-minute returns and Bitcoin's 1-minute returns, computed over two windows: 1 hour (60 bars) and 24 hours (1440 bars). +1 means the coin is moving tick-for-tick with BTC. 0 means no relationship. −1 means it's moving opposite. The two windows answer different questions: the 1h tells you what's happening right now; the 24h tells you what's normal for this coin.
Formula & calculation
#r = Σ((r_asset - r̄_asset)(r_btc - r̄_btc)) / sqrt(Σ(r_asset - r̄_asset)² × Σ(r_btc - r̄_btc)²)Where
r_asset and r_btc are the 1-minute close-to-close returns of the coin and BTC over the lookback window.Computed independently for 1h (last 60 completed 1-minute bars) and 24h (last 1440 completed 1-minute bars).
Units & range
−1 to +1 (unitless). +1 = moves tick-for-tick with BTC. 0 = no relationship. −1 = moves opposite to BTC.
Interpretation
#> 0.7 (1h): The coin is in BTC-beta mode. Any signal that fires here is probably macro, not coin-specific. Check what BTC is doing before acting.
−0.3 to +0.3 (1h): The coin is moving on its own. Volume anomalies and taker imbalances here carry real signal, they're not just BTC repriced.
< −0.3 (1h): Moving counter to BTC. Could be an inverse product, a coin under specific selling pressure, or an early divergence before a news-driven move.
1h well below 24h: Something changed. A coin that normally sits at 0.85 (24h) dropping to 0.1 (1h) is breaking away from macro flow, usually a large position being built or a coin-specific catalyst emerging.
−0.3 to +0.3 (1h): The coin is moving on its own. Volume anomalies and taker imbalances here carry real signal, they're not just BTC repriced.
< −0.3 (1h): Moving counter to BTC. Could be an inverse product, a coin under specific selling pressure, or an early divergence before a news-driven move.
1h well below 24h: Something changed. A coin that normally sits at 0.85 (24h) dropping to 0.1 (1h) is breaking away from macro flow, usually a large position being built or a coin-specific catalyst emerging.
Practical usage
#Not a standalone signal. Use it to qualify scanner results. When an anomaly fires, check whether that coin was already moving with BTC. If the 1h correlation is high, you're looking at macro, not an edge.
To scan BTC-correlated breakouts: require high 1h correlation and pair with BTC's own anomaly metrics. You're trading macro momentum, not coin selection.
A drop in 1h correlation relative to the 24h baseline is worth watching on its own. When a normally correlated coin breaks away, something is happening, even before the volume confirms it.
Buy Volume Z-Score (5m) > 2.5 AND Net Taker Imbalance > 25 AND Correlation to BTC (1h) < 0.4To scan BTC-correlated breakouts: require high 1h correlation and pair with BTC's own anomaly metrics. You're trading macro momentum, not coin selection.
A drop in 1h correlation relative to the 24h baseline is worth watching on its own. When a normally correlated coin breaks away, something is happening, even before the volume confirms it.
Common mistakes
#Frequent interpretation traps and misuse patterns to avoid when applying this metric.
- Using the 24h value as a real-time filter. The 24h is a baseline, not the current state. When correlation is shifting, the 1h leads.
- Treating 0 correlation as unremarkable. If a coin that normally reads 0.85 suddenly reads 0.05, that's not neutral it's unusual.
- Applying the same threshold to every coin. Small-caps are structurally less correlated to BTC than large-caps. A 0.4 reading means different things depending on the coin.
- Confusing price correlation with return correlation. Two coins can track each other in price while reading low return correlation if their minute-by-minute moves don't align.