Bitcoin vs QQQ

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I’ve been wanting to experiment with more short, informal posts on things I’m noticing in markets. Little “random ramblings” instead of the usual deep dives.

Yes, I’m openly stealing the idea from Andrew Walker — and if you’re not already subscribed to him, you really should be. I’ve been a long-time reader and a frequent listener. Andrew Walker’s interviews are some of the sharpest in the investing space, and his podcast has become one of the few I never skip.

So I’m going to try my own version here on Coughlin Capital: quick, free notes on charts, quirks, and small things that catch my eye. Not fully baked theses. Not trade ideas. Just things I find interesting as I’m watching the market and thinking out loud.

Today’s ramble: Bitcoin vs. QQQ.

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I should start with a proud confession: I still sit pretty firmly in the Charlie Munger camp on crypto.

I don’t own Bitcoin. I don’t plan to own Bitcoin. I’ve never been able to convince myself it has any fundamental value I can underwrite like a business. No cash flows, no customers, no products. Just a price and a story.

Call it “rat poison squared,” call it “digital gold,” call it whatever you want. For me, it’s just not an asset I can comfortably hold as a long-term owner. I’m fine being wrong on it forever if that’s what happens. I’ll stick to businesses I can understand.

That said, I still watch Bitcoin.

Not as an investment, but as a kind of speculative mood gauge. Over the last few years it has mostly traded in the same direction as the high-beta stuff in the market. When people feel good and are reaching for risk, Bitcoin and things like QQQ tend to rip together. When fear shows up, they usually puke together too.

Which is why the chart (h/t Callum Thomas) I dropped in this post caught my eye.

It plots Bitcoin against the Nasdaq/QQQ over the last few years. For most of the chart, the red and black lines are dancing pretty close. Maybe not tick-for-tick, but the general rhythm is the same: boom, bust, boom again. Classic speculative cycle stuff.

Lately though, they’ve split.

Bitcoin has rolled over and given back a chunk of its gains. QQQ, on the other hand, is still hanging out near its highs, floating on the back of Big Tech and AI enthusiasm. Same macro backdrop, same Fed, same economy… very different recent path.

I don’t have some grand “this must mean X” takeaway, but here are a few thoughts that went through my head looking at it:

• Maybe this is nothing more than crypto-specific drama doing what crypto always does: over-shooting in both directions and shaking the tree every few months.

• Maybe it’s a sign that the pure speculative end of the market is cooling off while investors still cling to the AI and mega-cap growth story. In other words, people are still willing to pay up for Nvidia and friends, but less willing to punt on digital tokens.

• Or maybe QQQ is just “late” to the move, and this divergence is the kind you only recognize in hindsight, right before tech takes a breather.

I don’t know which of those is right. Nobody does in real time.

What I do think this little divergence is good for is a quick ego check. When everything is going straight up together, it’s easy to tell ourselves comforting stories about how “this time is different” and correlations prove we’re in some kind of new regime. Then, quietly, the relationships we lean on start to wobble.

Bitcoin has been one of those relationships. For years now, people have talked about it as a pure play on liquidity and risk appetite. The thinking goes: if Bitcoin is ripping, speculative mood is strong, and the rest of the risk complex can probably keep grinding. If Bitcoin is puking, time to duck.

Well, right now, Bitcoin is looking tired while QQQ is still throwing a party. Somebody is “wrong.” We just don’t know who yet.

For me as a stock picker, the lesson is pretty simple and pretty old:

use these things as signals, not as anchors.

It’s fine to keep an eye on Bitcoin or whatever the mood thermometer of the day is. It’s interesting when a relationship that usually holds suddenly doesn’t. But if you start managing your portfolio off one chart, whether it’s BTC, QQQ, yields, or anything else, you’ve quietly left the business of owning companies and wandered into macro fortune-telling.

So that’s all this post is. Not a call. Not a “short QQQ, buy BTC” trade idea. Just a small observation from a long-term business owner who still thinks crypto is useless, but admits the price action matters to a lot of people.

Right now, the speculative mood gauge and the tech benchmark are disagreeing with each other. Maybe they reconnect with Bitcoin catching a bid again. Maybe QQQ finally exhales. Maybe this little gap just drifts on and becomes the new normal.

Take it for what it is: a small, curious wrinkle in a market that never runs out of them.