As BTC Bulls Defend $70K Bitcoin Vs. Gold Bottom appears.
Bitcoin (BTC) has weathered a 14-month bear market with gold, with the BTC/gold ratio and momentum indicators hitting historic lows that marked cycle bottoms earlier.
Main Receptors:
The BTC/GOLD ratio is at historic lows with many indicators pointing to a cycle bottom.
Bitcoin price needs to hold $70,000 to avoid a deep fall in the coming weeks.
BTC/GOLD RSI, MACD print classic reversal signal
Data from TradingView shows that the Relative Strength Index (RSI) of the BTC/GOLD ratio has started to climb.
The weekly RSI reached the oversold 21 level in mid-February, indicating fading bullish momentum.
RELATED: Bitcoin Tests 2021 Top As Gold Drops To Six-Week Low Below $4.7K
Similarly, the moving average converging divergence (MACD) indicator has fallen to an all-time low and is about to form a prominent cross.
Note that previous crossovers, especially those that come after the RSI recovers from oversold conditions, signal a macro bottom for the ratio.
This eventually led to a 280%-620% Bitcoin price crash against gold as seen in 2019, 2021 and 2023.
The RSI has now recovered from 21 to 33 in mid-February. When combined with a buy signal on the MACD, the picture begins to resemble previous cycles.
“The bottom is in $BTC vs Gold,” technical analyst James Isto said in an X post on Friday, saying “the stage is set” for a Bitcoin recovery.
The last time Bitcoin was pegged to gold was in 2018. It was in November 2022. It started a 700% BTC price rally and currently stands at an all-time high of $126,000.
According to Geometric analysts, the last 3 BTC/GOLD bear markets lasted 12-14 months, with gains ranging from 75% to 84%.
About 13 months into the current cycle, it is “down 81% so far, outpacing the 2021 bear market,” the analysts added.
“I think there's a strong case for potential down here.”
Investor and analyst Crypto Ferghani echoed both of the above scenarios:
“For over 13 years, we've seen the same pattern: Bitcoin entered a bear market against gold that lasted about 400 days. At that time, the RSI fell into oversold territory. Historically, these levels have always marked the bottom.”
Bitcoin price must hold above $70,000.
Meanwhile, BTC/USD remains cautiously bullish as long as it holds the $68,000-$70,000 support zone. This is where the 200-week moving average (EMA) and 50-day simple moving average are placed.
The 200-week EMA forms a key support band for BTC price during bear markets, and analysts warn that its reliability may be tested at Sunday's weekly close.
Bitcoin analyst Alphabetic said that as long as the price remains above the weekly low of $68,800, he is confident that Bitcoin will recover to $80,000 before falling back to $50,000.
“I don't want to see this week's low go away, if not it will go back to a new low or low to a new low!”
According to Cointelegraph, the $70,000 hold is in line with the previous fractal recovery path, opening a move towards $76,000-$80,000.
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