Dan Tabirou, co-founder of 10T Holdings, said weak hands are shaking in the gold market. This increases the likelihood of a short term meeting for gold, especially when it comes to the 80-day withdrawal period.
A rise in the price of gold and the dollar could lower the price of bitcoins
Bitcoin has had strong momentum in the past three months when it landed full-time jobs at Coinbase and several other major exchanges.
Regardless, the threat of a bitcoin correction is a real possibility if gold begins to recover in line with the US dollar.
Tapero said the largest liquidation in three weeks in the gold market increases the potential for an upside. he wrote:
“Very optimistic about #gold. The biggest settlement in 3 weeks has just happened. Weak hands are disinfected. $ 25 billion has been invested in capital in developing countries, and much more in the capital of the United States. Only 8 billion dollars in gold. Maybe a small amount in # bitcoin. #BTC isn’t big enough yet to be a macro asset class … but soon. ”
Some may see gold mining as a positive factor for Bitcoin in the medium term. As more and more investors start accepting bitcoin as a store of value, the trend towards gold may be in favor of the cryptocurrency.
However, according to Cointelegraph, this is a more compelling case of Bitcoin’s rally coinciding with a large influx of gold. This means that the rise in gold may affect Bitcoin’s performance in the short term.
The equivalent rise in US stocks is another factor.
The US stock market continues to rise due to the large liquidity of the Central Bank. A combination of moderate inflation and easing economic conditions pushed stocks to all-time highs.
As a result, Ian Newvenhies, an independent financial researcher at The Gold Observer, reports that US stocks have been their best month since 1987.
There is a possibility that the continued rally in US stocks could make other risky assets less convincing in the short term. It could make BTC a less significant deal for both individual and institutional investors for the foreseeable future.
At this point, many traders believe Bitcoin is at risk of seeing deeper withdrawals of up to $ 18,600 after the last rejection.
Michael Van de Pope, a full-time trader on the Amsterdam Stock Exchange, said the drop in BTC from $ 19,100 due to strong sellers’ reaction is likely to lead to an even bigger drop. he wrote:
“We failed to break through the $ 19,400 deciding factor, after which there was a drop to $ 18,800. $ 19,100 range retracts immediately and potential down to $ 18,600. ”
Bitcoin (BTC) is under risk of pullback as analysts expect gold to rebound significantly. The precious metal has performed worse compared to BTC in recent weeks, when the dominant cryptocurrency has seen an ETF-led rally.