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Bitcoin is beginning to display preliminary signs of outperforming gold, as the BTC gold ratio recovers towards 16 ounces following a significant cycle decline.
Bitcoin barely clings to monthly gains. (Tyler Stableford/Getty images)
What to know:
- A red monthly close would signify six consecutive losses, equaling the record set from August 2018 to January 2019.
- Bitcoin continues to remain above its 200-week moving average near $59,000, while the BTC gold ratio starts to recover from cycle lows.
In this article
USDT$0.9998◢0.00%
With just over a week remaining in March, bitcoin is marginally on track to evade a historic losing streak. The asset has gained approximately 2% this month, maintaining a position above $68,000. Nevertheless, a late downturn would result in bitcoin closing six consecutive months in the negative, equaling the longest negative streak recorded, which last occurred between August 2018 and January 2019.
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From a technical perspective, the 200-week moving average (200WMA) remains a crucial level to monitor. This indicator, which reflects bitcoin’s long-term trend by averaging its closing price over the last 200 weeks, has historically served as robust support during bear markets.
In the current cycle, the 200WMA is positioned near $59,000. Bitcoin fell to a low of $60,000 in early February and has since stabilized above this threshold for almost two months, indicating sustained strength at this vital support level. It is important to note that the 2022 bear market is the only cycle where bitcoin spent an extended period below the 200WMA, from June through December.
BTC 200WMA (Glassnode)
Aside from USD price dynamics, bitcoin is also starting to exhibit relative strength compared to gold. It is set to record its first positive monthly candle against gold in eight months, with the bitcoin to gold ratio currently approximately 16 ounces. Gold is trading around $4,200 after recently declining towards $4,000, representing a 5% decrease for the day. Gold has now fallen over 25% from its all-time high in January, resulting in a loss of $7.5 trillion in market capitalization.
Historically, each cycle has experienced smaller retracements in the bitcoin to gold ratio from its peak. In this cycle, bitcoin experienced a decline of around 71% against gold from its all-time high in December 2024. These peak-to-trough cycles have generally lasted about 400 days, indicating that the current downturn might be overstated in this ratio.
If bitcoin can sustain support above the 200WMA while regaining strength against gold, it would reinforce the perspective that the overall uptrend remains intact.
BTCUSD/XAUUSD (TradingView)
