Bitcoin (BTC) has lagged behind Gold since the leading cryptocurrency’s all-time high in 2021.
The bitcoin Bitcoin/Gold ratio now faces important resistance against the stock market and two possible outcomes surge for BTC.
In particular, Bloomberg’s commodity expert Mike McGlone analyzes the current economic scenario and leans toward a recession. McGlone posted his Analysis on X (formerly Twitter) on January 23, warning of trickle-down risks moving forward.
The commodity expert explained Bitcoin surged in a favorable scenario of zero-interest rate policies (ZIRP) after a financial crisis. However, the cryptocurrency started to lag behind Gold when interest rates rose.
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Now, the Bitcoin/Gold ratio also lags behind the stock market with a recent resistance validation, possibly trending downwards. At least, this is what Mike McGlone believes will happen while sounding the alarm of a recession for Bitcoin.
Born of the global financial crisis and zero interest-rate policies (ZIRP), #Bitcoin’s lagging performance vs. #gold since the 2021 peak, despite the record-setting US #stockmarket, may portend crypto catch-up or #recession leanings. My bias is the latter, and the chart… pic.twitter.com/f9v7nVT0eg— Mike McGlone (@mikemcglone11) January 23, 2024
BTC price analysis and the Bitcoin/Gold ratio
Moreover, the Bloomberg analyst hints at the Bitcoin spot ETF frenzy as a top signal preceding this recession forecast. Interestingly, this insight traces a comparison to gold’s lack of yield as an investment:
“Lacking earning and interest are top reasons gold isn’t widely held in portfolios amid increasing finalization, which could also pertain to Bitcoin. The crypto exchange-traded fund frenzy might be looked back upon as a bell ringing at the top.” — Mike McGlone for Bloomberg
Meanwhile, Bitcoin has lost nearly 18% since its peak at $48,965 on January 11, following the ETF’s approval. It is currently trading at $40,174 after losing an important support line, now struggling to break this resistance back.
BTC/USD daily price chart. Source: TradingView
It is worth mentioning that BTC’s daily Relative Strength Index (RSI) is signaling weakness. Nevertheless, Bitcoin could return to December’s range and regain its strength in an uptrend.
In summary, McGlone expects the Bitcoin/Gold ratio to continue falling despite Bitcoin’s individual performance. Essentially, this suggests Gold is a better investment than BTC for 2024 until the observed trend shifts.
Investors must act with caution and follow further developments to make profitable decisions.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.