The Bitcoin-to-gold price ratio has bounced from a critical multi-year support level, signaling a potential long-term trend change. Analysts note a bullish technical divergence alongside a stark reversal in ETF fund flows, with capital fleeing gold products and entering Bitcoin funds. This shift occurs as macroeconomic volatility creates what researchers describe as an “opportunity within risk” for the cryptocurrency.
Bitcoin’s long-term price trend against gold shows a bullish shift after retracing to a level seen in 2017, 2022, and 2023. Analysts describe the potential trend change alongside an “opportunity within risk.”
Michaël van de Poppe noted the Bitcoin-to-gold ratio is showing strength after forming a bullish divergence with the relative strength index. This setup signals fading selling pressure when price forms lower lows as momentum indicators form higher lows.
In February, the ratio retraced to a key support level near 12-13 that previously acted as resistance in 2017. That level turned into support in 2022 and 2023, indicating a potential bottom for Bitcoin’s trend against gold.
Another reason is the change in Bitcoin and gold exchange-traded funds flows over the past month. The US gold-backed ETF, SPDR Gold Shares (GLD), recorded a $3 billion outflow on March 6.
The Kobeissi Letter stated, “This surpasses any previous large daily outflow seen over the last 2 years by +200%.” Meanwhile, the 30-day change in Bitcoin ETF flows improved to $906 million in net inflows on March 11.
The holdings measured in native units show another divergence. The 30-day change in Bitcoin ETF balances has improved to 12,909 BTC from -34,197 BTC.
According to Binance Research, the current macro volatility may present an “opportunity within risk” for Bitcoin. The report noted BTC has moved similarly to macro assets like oil and US equities amid geopolitical events.
Capital is starting to return to BTC despite the volatility. The share of Bitcoin trading volume from US spot ETFs has increased recently, signaling rising institutional activity.
