Bitcoin Lags Behind Gold Since All-Time High
Since reaching its all-time high in 2021, Bitcoin (BTC) has been trailing behind Gold. The Bitcoin/Gold ratio is currently facing resistance from the stock market, leading to two potential outcomes for BTC.
Bloomberg’s commodity expert, Mike McGlone, predicts a recession and warns of trickle-down risks. He explains that Bitcoin performed well in a zero-interest rate environment after a financial crisis but started to fall behind Gold as interest rates rose.
BTC Price Analysis and the Bitcoin/Gold Ratio
McGlone suggests that the frenzy around the Bitcoin spot ETF could be a signal of an impending recession. He compares this to gold’s lack of yield as an investment. The recent approval of the ETF has caused Bitcoin to lose nearly 18% since its peak on January 11. It is currently struggling to break through resistance at $40,174.
The daily Relative Strength Index (RSI) for BTC indicates weakness, but there is potential for it to regain strength in an uptrend and return to December’s range.
Bitcoin/Gold Ratio Expected to Continue Falling
Despite Bitcoin’s individual performance, McGlone believes that the Bitcoin/Gold ratio will continue to decline. This suggests that Gold may be a better investment than BTC until the trend shifts. Investors should proceed with caution and stay updated on developments to make informed decisions.
Hot Take: Gold Outperforms Bitcoin as Economy Faces Uncertainty
The current economic scenario raises concerns about a potential recession, according to Bloomberg’s commodity expert Mike McGlone. As interest rates rise, Bitcoin has fallen behind Gold in terms of performance. The recent resistance validation against the stock market further supports this trend.
McGlone also highlights the Bitcoin spot ETF frenzy as a potential indicator of an upcoming recession. Comparing it to gold’s lack of yield, he suggests that the ETF’s approval may have signaled a peak for Bitcoin.
While Bitcoin’s price has experienced a decline, there is still potential for it to regain strength and return to previous levels. However, McGlone expects the Bitcoin/Gold ratio to continue falling, indicating that Gold may be a better investment option for the time being. Investors should exercise caution and closely monitor market developments to make informed decisions.
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