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Gold challenges Bitcoin: let the games begin

Today, the gold price reached a new all-time high at nearly $3,550 per ounce. Bitcoin, however, in the last two weeks has fallen from all-time highs of over $124,000. The fact is that for a few days now a new rally in the price of gold has started, while Bitcoin for now seems to be …

oro bitcoin

Today, the gold price reached a new all-time high at nearly $3,550 per ounce.

Bitcoin, however, in the last two weeks has fallen from all-time highs of over $124,000.

The fact is that for a few days now a new rally in the price of gold has started, while Bitcoin for now seems to be essentially stagnant. 

Gold Price at All-Time Highs

The price of gold surpassed $3,500 per ounce for the first time in history this April, but it stopped right at that threshold. 

The following month corrected to $3,120, then began a period of substantial sideways movement until the end of August, during which it fluctuated between approximately $3,200 and $3,400 per ounce. 

This period of lateralization ended on August 26, when a new rally began, still ongoing, which saw it climb first above $3,400 and then also above $3,500.

It is noteworthy that starting from that date, all daily stock market sessions have concluded with the price of gold rising. 

The current level is still only slightly above the peak of April, but back then it had already fallen below $3,300 the very next day. This time, however, it has been above $3,500 for two days, giving the impression of wanting to continue growing. 

Technically, its trend is still within an ascending channel that began at the end of November 2024, when it was around $2,600, and which seemed ready to break shortly after mid-August with the drop to just over $3,300. Instead, from that drop, a rebound started, still ongoing, which has brought it to new all-time highs. 

Bitcoin Price Between ATH and Corrections

The price trend of Bitcoin in recent months has been completely different. 

It must be said that, although Bitcoin is often considered a sort of “digital gold“, it is actually very different from real gold, because the latter is risk-off while BTC is risk-on. 

Therefore, it should not be surprising at all that the price trends of the two assets differ. 

Bitcoin, for example, in the first half of August was rising just as gold was falling, and since gold started to rise again, the price of Bitcoin has continued to fall. 

However, the decline of Bitcoin at the end of August is actually minor compared to the enormous growth at the beginning of August, so much so that the current price is not only perfectly in line with that of July 10, but it is also higher than the January peak, and quite in line with the May peak.

It is enough to say that the 365-day moving average, which in October 2024 was below $60,000, has been continuously rising since June 2023, and has now reached almost $94,000: this is the highest value ever. 

BTCUSDT and XAUUSD quotes by TradingView

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Comparison between Bitcoin and Gold

The trend of the price of Bitcoin and that of gold have at least one thing in common. 

In fact, both react positively to the loss of value of fiat currencies, and in particular the US dollar. 

There is an index, called USCPI, which measures the trend of consumer prices in the USA, and can be used to evaluate over time the loss of purchasing power (and therefore of value) of the dollar. 

At the beginning of 2020, before the COVID pandemic, this index was at 257 points. The following year it had already risen to 260, and at the beginning of 2022 it nearly reached 280 points. 

With the worsening of inflation, it then rose to 307 at the beginning of 2024, and to 316 at the beginning of this year. Now it stands at 323 points. 

In the same period when USCPI rose from 257 to 323 points, the price of gold increased from $1,500 to $3,550 per ounce, and that of Bitcoin from $7,000 to $111,000. 

Surely the rise of USCPI, which in the long term is inevitable, is not the only reason for the stellar performances of gold and Bitcoin in the last five years, but it is clear that it has had a very similar impact on the two assets. 

The fact is that, being Bitcoin a risk-on asset, it performs better during bull runs, while gold theoretically should perform better especially during bear markets. However, it should be added that the current trend in the price of gold is mainly weighed down by concerns for the medium and long-term future, something that does not seem to be reflected in Bitcoin.

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