Bitcoin’s three-month bullish trend against gold appears to be over, as ETF flows shift toward gold and other precious metals.
This is evident from the bitcoin-gold ratio, which measures the dollar price per coin of BTC against the dollar price per ounce of gold. This is the chart that indicates which “store of value” investors prefer at any given time.
Since the beginning of March, bitcoin has been the clear winner, raising the ratio from about 12 points to 18 points.
But not anymore.
Growth has stalled lately and, in the last 24 hours, has dropped decisively, breaking the three-month uptrend.
The ratio has crossed the bullish trend line, which characterizes the mini bull run of BTC against gold. In the world of technical analysis, this is a major collapse, signaling a renewed shift in momentum in favor of gold.
Why this matters
The signal is not just about lines on the chart, it tells us where the smart money will go next.
When the war with Iran began in late February and oil prices soared to more than $100 a barrel, investors looked for a place to park cash. And for a time they bet on bitcoin as a refuge, as evidenced by the rebound in the BTC-gold ratio.
But the same ratio has now invalidated its bullish trend, pointing to renewed investor rotation into gold.
Keep in mind that chart patterns such as trend line breakouts can and often are fleeting, but for now, the message is clear: Gold could outperform BTC in the near term.
Market flows support that interpretation.
In-Demand Precious Metals ETFs
Bitcoin-linked exchange-traded funds have fallen out of favor with investors, losing more than $2 billion in two weeks amid a tightening in Treasury yields and the prospect of longer-term higher U.S. interest rates.
Meanwhile, gold and precious metal funds are in demand. These funds attracted $2.34 billion in investor money during the week ending May 20, extending their streak of inflows to a second consecutive week, Reuters reported, citing data from LSEG Lipper.
At the time of writing, bitcoin changed hands near $75,600, down 0.3% as of midnight UTC, and gold traded virtually flat around $4,500.
