Bitcoin-Gold Ratio Reverses 25% Slide, Signals Bullish Shift
1min read Bitcoin has been on a downward trend for the past 12 weeks, with gold outperforming it significantly. Gold has surged by 22% this year due to safe-haven bids and arbitrage plays, while bitcoin has dropped over 8%. This has resulted in a more than 25% slide in the bitcoin-gold ratio, which represents the per unit USD price of bitcoin relative to the per ounce USD price of gold.
However, the downtrend in the bitcoin-gold ratio, represented by trendlines drawn off Jan. 20 and March 3 highs, has been invalidated this week. The ratio topped the trendline over the weekend in a bullish breakout, suggesting that bitcoin may start to outperform gold and potentially catch up with the rally in the yellow metal. This trendline breakout is accompanied by the MACD's histogram's positive flip, signaling a bullish shift in momentum. The bullish crossover of the 5- and 10-day simple moving averages (SMA) also suggests the same.
This analysis is consistent with Theya Research's Joe Consorti, which shows bitcoin tends to lag gold by 100 to 150 days. The trendline breakout and the bullish shift in momentum indicate that bitcoin may be poised for gains against gold in the coming weeks.
Meanwhile, the outlook for privacy-focused monero (XMR) appears constructive following the past week's sharp recovery from $165 to over $200. This recovery left a "long-tailed" candle on the weekly chart, a sign of dip demand. The token has broken out of a prolonged consolidation pattern, with the 50-week SMA moving above the 200-week SMA to confirm a golden crossover, an indicator representing a long-term bullish shift in momentum.
The immediate resistance for monero is seen at $242, the February high, followed by $289, the April 2022 high, with support at $200 and last week's low of $165. The golden crossover and the bullish shift in momentum suggest that monero may continue to see gains in the coming weeks.
