Gold is currently on its longest losing streak in over a century, its worst run since February 1920, lasting 10 straight days, according to Bloomberg analyst Katie Greifeld.
The yellow metal has fallen as much as 27% from its January high, falling to a low of $4,090, finding support at its 200-day moving average, a closely watched technical level that often signals long-term trend strength.
However, it is up about 2% over the past 24 hours, likely signaling the end of the streak. Since the escalation of the Middle East conflict in late February, gold is still down about 12%.
Meanwhile, bitcoin, often referred to as digital gold, is holding above $70,000, keeping the bitcoin-to-gold ratio just below 16 ounces. The ratio bottomed out at around 12 ounces just before the Middle East conflict, meaning the ratio is up around 30% from those lows, with bitcoin doing better.
Charlie Morris, Chief Investment Officer at ByteTree, noted: “I remember the excitement when 1 BTC first surpassed an ounce of gold in March 2017. Since then it has consistently built higher lows, reaching 2.7oz in 2019, 3.4oz during the 2020 pandemic and FTX1 collapse oz-crashed 9.1oz this year. Now one BTC is worth 16 ounces of gold. With gold, that appears to be depleted, we could reasonably expect a new all time high above 40 ounces in the coming months or years.
Historically, bitcoin has tended to lag gold in market cycles. Gold typically leads with an initial rally, then consolidates, allowing bitcoin to catch up and surpass.
While Bloomberg ETF analyst Eric Balchunas argues that bitcoin and gold are not inversely correlated, but rather largely uncorrelated.
He points out that gold exchange-traded funds (ETFs) such as the SPDR Gold Trust (GLD) and the iShares Gold Trust (IAU) have seen billions of dollars in outflows over the past week.
In contrast, bitcoin ETFs have recorded about $2.5 billion in inflows this month, with only about $140 million in net outflows year-to-date, despite bitcoin falling about 20% in that period.
