Bitcoin Breaches 12-Year Support Line Against Gold
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As Bitcoin (BTC) struggled in the latest cryptocurrency market decline – failing to decisively surpass the $84,000 resistance – Gold (XAU) continued its impressive rally, soaring to a record high of $3,000 per ounce on March 14.
Bitcoin is beaten by gold
2025 begins sending shaky notes to the world’s largest cryptocurrency. BTC year-to-year to over 10% (YTD), down from $94,000 on January 1 to $84,000 at the time of writing. On the other hand, gold soared nearly 13% during the same period.
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Market analyst Polaris shared The following chart on X yesterday illustrates the BTC to gold ratio over the past 12 years. According to the chart, BTC began to break through a key support line that has been around for more than a decade.
If Bitcoin maintains price action below this support line for weeks or months, it could mark the end of the current crypto bull run. BTC’s poor performance against gold is also evident in the comparative capital inflows into BTC and gold exchange trade funds (ETFs).
according to data Judging from the World Gold Council, the U.S. spot gold ETF has attracted more than $6 billion inflows. Globally, spot gold ETF inflows exceed US$23 billion.
at the same time, data From Sosovalue, the U.S.-based BTC ETF experienced nearly $1.5 billion in net outing YTD. This sharp contrast in the capital movement reflects the shift in investor strategy from risky boarding to risky assets.
Several factors may explain investors’ growing dislike of risky assets, including new trade tariffs by U.S. President Donald Trump, hawkish monetary policy of the U.S. Federal Reserve and more recently, the stock market.
Did the crypto bull run away?
BTC’s poor performance relative to gold expresses doubts about the lifespan of the current crypto bull market. Since the beginning of the year, the cryptocurrency market capitalization has lost more than $600 billion, and now it is about $2.8 trillion.
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Peter Schiff, a well-known gold advocate, believes that BTC has been in a bear market in the past three years. In X posts, Schiff statement:
Now, a bitcoin buys 27.7 ounces of gold. At the peak of 2021, a Bitcoin bought 36.3 ounces of gold. This means that, in terms of money, the price of Bitcoin fell 24%. So, Bitcoin has been in an invisible bear market for the past three and a half years.
That is, positive macroeconomic development may still make BTC favorable. For example, U.S. inflation Appear Cooling, which could force the Fed to move to quantitative easing and improve market liquidity – a potential boon for risky boarding assets.
Similarly, a break down May be reignited in the U.S. dollar index optimism For assets such as stocks and cryptocurrencies. At press time, BTC traded at $84,902, up 3.8% over the past 24 hours.
Featured images from Unsplash, charts from X and TradingView.com
