BTC/Gold Ratio Breaks Critical Support

Bitcoin falters against gold. The BTC/XAU ratio has just dropped to a critical threshold: 20 ounces of gold for one bitcoin, a level never reached since early 2024. For analysts, this reflects a possible cycle turning point and revives the debate between supporters of a technical rebound and those fearing a new bear market. Between tension and hope, a key indicator resurfaces and could change everything.

The Return of a Major Technical Signal

The BTC/XAU ratio, that is the amount of gold needed to buy one bitcoin, has dropped to about 20 ounces, a level the market has not seen since early 2024, while the flagship crypto had revived its correlation with the precious metal.

This drop alerts technical analysts, especially as it happens while gold remains close to its historical highs. For Michaël van de Poppe, a recognized trader and analyst, this threshold represents much more than a simple price level: “the last time the markets hit their bottom was also when the BTC/USD ratio against gold reached a low. One of the two is overvalued. The other is undervalued.” He states that gold is currently overvalued, while bitcoin would have entered a potential buying zone.

Van de Poppe’s technical arguments are based on several specific indicators, including the following :

• The weekly RSI (Relative Strength Index) of the BTC/XAU ratio has fallen to 29.5, placing the indicator in oversold territory, traditionally interpreted as a potential reversal signal ;

• A bullish divergence appears on the daily timeframe, meaning the RSI rises while the price continues to fall, a pattern often observed before short-term recoveries ;

• This technical configuration recalls those that preceded major rebounds during previous bear cycles of bitcoin.

According to this reading, the current level does not signal a collapse but rather a market bottom in formation, likely to open the way for a gradual reversal. A cautious hypothesis, certainly, but one that resonates with those who consider bitcoin structurally undervalued at the present time.

A Trend Break or Simple Consolidation ?

While some perceive this drop as a market bottom, others see it as a worrying break signal.

The expert Wealthmanager, specializing in macro-financial analyses, stresses that “the last bitcoin bear market officially began when we lost this support.” For him, the 20-ounce threshold is not just a technical point but a symbolic pivot between bull and bear markets. “I expect we will consolidate here for some time, but a breakout is likely in the coming weeks,” he warns.

Another cautious voice is trader Ted Pillows, who draws attention to a distinct point : the loss of a long-term upward trend in the BTC/XAU ratio. On technical charts, this break is visible and, according to him, marks a potential transition to an underperformance regime for bitcoin against gold.

This change in dynamics could be explained by gold maintaining levels near its historical highs, in an uncertain macroeconomic climate where investors primarily seek stability.

While technical signals suggest a possible rebound, caution remains advisable. American monetary tightening is slowing Bitcoin’s progress, reinforcing gold’s attractiveness. In this uncertain context, BTC/XAU ratio behavior over the coming weeks could provide valuable insights into investor preference evolution.