Bitcoin slips toward $71,000 even as software stocks surge higher.

Bitcoin’s recent rally is losing steam even as technology stocks rebound, highlighting a growing divergence between two markets that had been moving almost in lockstep in recent months.

Bitcoin slipped about 2% over the past 24 hours to around $71,400 after its early-week surge began to fade following the opening of U.S. trading on Thursday.

The pullback coincided with broader weakness in equities as geopolitical tensions surrounding the Iran conflict continued to weigh on markets. Oil prices jumped roughly 5.3% to about $78.70 per barrel amid concerns about prolonged instability. The Dow Jones Industrial Average fell 1.4%, while the S&P 500 declined 0.7%.

The tech-heavy Nasdaq Composite was more resilient, slipping just 0.4% as the previously pressured software sector staged a sharp rebound. The iShares Expanded Tech-Software Sector ETF (IGV) rose about 2% on the day and has gained roughly 9% over the past five sessions.

The divergence is noteworthy because bitcoin and software stocks have shown a tight correlation since October. Both assets declined together amid investor concerns about the impact of artificial intelligence on the software industry and then rebounded simultaneously from their recent lows.

Still, some analysts caution that bitcoin’s recovery may not yet be secure. Arthur Hayes, chief investment officer at Maelstrom, said the cryptocurrency’s recent rally toward $74,000 has not broken its correlation with the IGV software ETF.

Whether Thursday’s decoupling persists remains uncertain, but software stocks advancing while bitcoin retreats is not the scenario many crypto bulls hoped to see. Hayes warned the rebound could still prove to be a temporary “dead cat bounce.”

Market participants may also be reducing risk ahead of Friday’s closely watched U.S. employment report for February. Recent economic data has consistently exceeded expectations, reducing the likelihood that the Federal Reserve will soon resume cutting interest rates.

According to derivatives pricing on the Chicago Mercantile Exchange, traders now see an 88% probability that the Fed will hold rates steady at both its upcoming meeting and again in April. Just a month ago, those odds were closer to 59%.

Despite near-term uncertainty, some market participants remain cautiously optimistic. Bryan Tan, a trader at Wintermute, said steady inflows into spot bitcoin exchange-traded funds — which have attracted nearly $2 billion over the past week — along with stabilizing trading volumes are providing support.

Tan added that the muted market reaction to disruptions around the Strait of Hormuz could leave room for bitcoin to revisit the $74,000 to $75,000 range if conditions improve.

Analysts at Bitfinex also pointed to a “notable increase in spot market strength,” suggesting that the recent price rise has been driven more by genuine buying demand rather than speculative leverage.

If that trend continues, they said, the market could see a period of relief in the weeks and months ahead.