The long-term balance between Gold price and Bitcoin price might be about to change, according to observations by a leading analyst.
Joao Wedson, a verified author at CryptoQuant, said bottom indicators in the BTC/Gold ratio were showing rare reversal conditions.
The setup appeared during a volatile phase for digital assets in mid-October 2025. Wedson described it as a potential “historic opportunity” for investors reassessing their exposure to traditional stores of value.
Historic BTC/Gold Ratio Signal Suggested Reversal
Wedson explained that bottom readings in the BTC/Gold ratio rarely appeared. When they did, they tended to coincide with extreme drawdowns and fading volatility across crypto markets.
He said those periods often marked major lows before extended Bitcoin recoveries. According to his chart, two color-coded markers highlighted the signal zones, a blue tag representing the current oscillator bottom and a green tag marking deeper alignment between indicators.
Wedson said the oscillator, which normalized price deviations between the two assets, was signaling a likely pivot. He summarized it as “time to sell gold and buy Bitcoin.”
Former BitMEX CEO Arthur Hayes made a similar observation in his recent macro report. Hayes said the Bitcoin price had reached a region that historically preceded multi-month rallies.
He described current conditions as one of the most favorable setups seen in years.
Wedson’s data suggested that prior occurrences of this signal had led to sharp recoveries, often followed by new all-time highs within months. He said the indicator’s accuracy improved when both tags aligned, the condition currently observed in his latest analysis.
At press time, the Bitcoin price was around $106,751, showing a 0.45 percent gain in the last 24 hours but down 4.45 percent for the week and 8.77 percent over the past month.
Despite short-term volatility, BTC remained up strongly year-to-date and nearly 60 percent compared with the same period last year.
Bitcoin Price Trend Influences Institutional Allocation
Wedson said his findings were particularly relevant to institutional portfolios.
He noted that many funds had increased their gold holdings throughout 2025 amid global market uncertainty.
He urged asset managers to review their allocations, arguing that Bitcoin now offered a stronger risk-reward balance than gold.
“If I were managing capital today, I’d be studying this chart closely,” Wedson said. He argued that market behavior suggested institutions might soon rotate capital back into digital assets.
The BTC/Gold ratio historically served as a gauge of investor confidence between the two stores of value.
When the ratio bottomed, it often marked Bitcoin’s weakest relative performance before periods of renewed strength.
This discussion revived a long-running debate between traditional and digital asset advocates.
Economist Peter Schiff recently claimed that Bitcoin failed to fulfill its “digital gold” narrative.
However, Binance founder Changpeng Zhao (CZ) countered, saying Bitcoin continued to demonstrate resilience across market cycles.
Analysts said that while gold price had outperformed during risk-off phases, Bitcoin tended to lead once macro liquidity improved. That shift, they said, might now be underway.
Forward Outlook: Deep-Value Zone Supports Accumulation
Additional data from analytics outlet Milk Road supported the thesis of undervaluation. The platform reported that the Bitcoin price traded roughly two standard deviations below its estimated fair-value range at the time of writing.
Such readings, analysts said, historically coincided with long accumulation phases rather than market tops.
Periods when Bitcoin traded that far below equilibrium often attracted large inflows from long-term holders and funds.
Milk Road described the current range as a “deep-value zone” based on macro and technical models. They said it might reflect the same pattern observed before major recoveries in 2019 and 2023.
Wedson’s interpretation aligned with this data. He said the BTC/Gold ratio and volatility compression both hinted that Bitcoin could be entering a new accumulation cycle.
Institutional positioning data and declining exchange reserves also reinforced that outlook, suggesting renewed investor confidence.
The broader macro backdrop remained uncertain under President Trump’s administration, but analysts said monetary policy expectations favored risk assets.
Easing inflation and a potential rate cut by the Federal Reserve in late 2025 were viewed as supportive factors for Bitcoin.
At press time, market observers said the technical and macro setups appeared consistent with the early stages of a multi-quarter recovery.
While no forecast was guaranteed, analysts said history showed that extreme pessimism in the BTC/Gold ratio often preceded periods of strong price appreciation.