Tuesday , May 24 2022

The Bitcoin price rally is in jeopardy as gold and US dollars show signs of recovery


Dan Tapiero, co-founder of 10T Holdings, he said that weak hands were shaken in the gold market. This increases the likelihood of a gold rally in the near future, especially as it comes from an 80-day period.

A rally in gold and the dollar may lower the price of Bitcoin

Bitcoin has seen strong momentum in the past three months, Recently has ever peaked on Coinbase and other major exchanges.

Despite this, the threat of a correction for Bitcoin is a real possibility if gold begins to rise alongside the US dollar.

The largest three-week gold outflows. Source: Dan Tapiero, BofA

According to Tapiero, the largest three-week sale in history in the gold market increases the likelihood of an uptrend. The he wrote:

“Very bullish for #gold. The largest sale happened in three weeks. Clearance of weak hands. $ 25bn went to EM stocks (emerging markets), much more to US equities. Only $ 8k Millions invested in gold. Maybe a tiny bit in #bitcoin. #BTC still isn’t big enough to be a macro asset class … but very soon. “

Some may consider gold recovery to be positive for Bitcoin in the medium term. As more investors begin to recognize BTC as a store of value, an uptrend in gold could benefit the cryptocurrency.

Yet, there is a stronger case to be made and the Bitcoin rally has coincided with major gold exits, as reported by Cointelegraph. That means a large rise in gold could hurt BTC’s momentum in the short term.

The parabolic rise of US stocks is another factor to consider

The US stock market continues to rise due to the unprecedented liquidity injected by the central bank. The combination of average inflation and financial easing conditions has been pushing stocks to record highs.

As a result, Jan Nieuwenhuijs, Independent Financial Researcher for The Gold Observer, US stocks have been reported to have had their best month since 1987.

The continuing upward trend in US equities has the potential to make other risky assets less attractive in the short term. It could also make BTC a less urgent operation for retail and institutional investors in the near future.

These days, many traders believe Bitcoin is in danger of being pulled deeper to $ 18,600 after it was recently rejected.

Michael van de Poppe, a full-time trader on the Amsterdam Stock Exchange, he said a BTC slide of $ 19,100 with a strong backlash from dealers makes a deeper slide likely. He wrote:

“It failed to cut above $ 19,400 as the all-important switch, and subsequently fell to $ 18,800. The area was immediately denied $ 19,100 and the probability of a dip increased to $ 18,600.”

Bitcoin (BTC) is in danger of being withdrawn while analysts predict that gold will improve greatly. The precious metal has underperformed BTC in recent weeks as the market-leading cryptocurrency sees a rally led by growing institutional interest.

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