Bitcoin Struggles as Gold Surges 4.4% Week-to-Date

Bitcoin is currently facing challenges as gold gains traction with week-to-date increases of nearly 5%. This shift has put Bitcoin's correlation with gold under scrutiny amidst ongoing macroeconomic changes. Traders are anticipating a short-term decline despite a broader rebound in Bitcoin's price.

Bitcoin (BTC) is approaching fresh month-to-date lows as the market remains directionless, contrasting with gold's rebound. Data from Cointelegraph Markets Pro and TradingView indicates that Bitcoin's price momentum has stalled at $95,000, inching closer to the key yearly open support level at $93,500. Meanwhile, gold (XAU/USD) has seen a 1.5% increase on the day, with week-to-date gains already at 4.4%.

Trading firm QCP Capital noted that crypto implied volatilities remain suppressed, with front-end skew drifting back toward neutral and spot largely directionless. The firm highlighted various swings across the macro spectrum, including the dollar staying lower and emerging market currencies surging alongside gold. QCP Capital also observed that the FX shakeup coincides with a nearly 3% surge in gold, as investors lean into the weaker-dollar narrative and price in geopolitical risk premia, including prospective US trade diplomacy.

With Bitcoin yet to follow suit, QCP Capital sees an increasingly binary next phase, with one outcome being that BTC "decouples from gold’s safe haven bid and relinks with broader risk proxies." In contrast, trading resource The Kobeissi Letter sees the "first gold, then Bitcoin" narrative sticking, noting that in April, Bitcoin joined the gold run, increasing correlation for the first time in months. Between April 7th and April 21st, gold surged +15% along with +12% in Bitcoin, suggesting a strong flight to decentralized and inflation-protected assets.

Technical data suggests that Bitcoin traders may be pausing within a broader comeback. Evidence for this came from the moving average convergence/divergence (MACD) indicator, which gave conflicting signals on longer and shorter timeframes. Popular trader Dave The Wave revealed a bullish signal on the weekly MACD, while daily behavior confirmed a bearish crossing below the zero line. Titan of Crypto summarized that BTC is consolidating between last week’s high and low, awaiting the Federal Reserve's meeting and Jerome Powell’s speech. Earlier, Keith Alan, co-founder of trading resource Material Indicators, warned that the yearly open was unlikely to hold as support, predicting a wick to the $88k - $90k range, with the $91.6k level around the 21 MA as a likely target this week.