Bitcoin (BTC) Dips Against Gold Again: Is This the Bottom?

Bitcoin has come down to the 25 ounce level against gold, a major horizontal support level. Is it now time for the Bitcoin/gold ratio to move back in Bitcoin’s favour?

Gold hits support, but there is probably more downside to come

Source: TradingView

While the Bitcoin price has continued to bleed after reaching its all-time high, the gold price looks as though it may have arrested its own slide, and this is at the $4,000 horizontal support.

That said, the 2-week chart above reveals that the Stochastic RSI indicators are just coming down from the top. This might suggest that the correction is not over yet. The ascending trendline could be a healthier retracement for the gold price, and this would see the price come down to around $3,600.

BTC/XAU ratio falls through ascending trendline

Source: TradingView

The weekly chart for BTC/XAU illustrates an interesting perspective. While the ratio has dipped below the ascending trendline again it has still to confirm a breakdown. This trendline stretches all the way back to the beginning of 2023 so it’s no small matter if this becomes a confirmed breakdown.

On the other side of the coin, the price is finding strong support at the 0.5 Fibonacci level, which matches up with the 25 ounces horizontal level. 

Furthermore, at the bottom of the chart, the Stochastic RSI indicators are at the bottom and are currently angled back to the upside. 

Next bounce in favour of BTC could take BTC/XAU ratio to new all-time high

Source: TradingView

The 2-week chart gives a very similar perspective. Although it can be seen that the 2 week period is due to finish at the end of play on Friday. This probably means that a new candle will open well below the ascending trendline, but as long as the current candle closes above the 25 ounces support level, a bounce-back can begin.

At the bottom of the chart, the Stochastic RSI indicators are at the bottom, and this is even the case in the monthly time frame. Would this not suggest that this next bounce in favour of Bitcoin has the potential to go much higher than the 41 ounces all-time high?

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.