Bitcoin-to-Gold Ratio Crashes Below 12-Year Support as Gold Hits Record $3K
Is Bitcoin’s Bull Run in Jeopardy?
Bitcoin's (BTC) long-standing uptrend against gold (XAU) took a serious hit on March 14, breaking a support trendline that had held strong for over 12 years. This key breakdown comes just as gold prices soared past the $3,000-per-ounce milestone, setting a new record high.
A Critical Moment for Bitcoin
Popular analyst NorthStar warns that if Bitcoin remains below this crucial trendline for a week—or worse, a month—it could spell the end of its decade-long bull market. So, is Bitcoin’s golden era fading? Let’s dive into the numbers.
Gold Surges as Bitcoin Stumbles
Gold’s historic rise comes amid a year-to-date (YTD) gain of about 12.80%, driven by growing macroeconomic uncertainty. Meanwhile, Bitcoin - often called “digital gold” - has fallen by 11% so far in 2025, highlighting a sharp contrast in investor sentiment.
The divergence is also evident in ETF flows. According to the World Gold Council, US-based spot gold ETFs have seen a staggering $6.48 billion in inflows YTD, while global gold ETFs attracted $23.18 billion.
On the flip side, Bitcoin ETFs in the US have suffered nearly $1.46 billion in outflows YTD, according to on-chain data platform Glassnode.
Trump’s Trade Policies and Global Uncertainty
The shifting investment landscape can be partly attributed to rising geopolitical and economic tensions. President Donald Trump’s aggressive trade policies - including new tariffs on China, Mexico, and Canada - have intensified fears of a global economic slowdown. This uncertainty has driven investors toward traditional safe-haven assets like gold.
Additionally, central banks in major economies like the US, China, and the UK have ramped up gold purchases, further fueling its price surge.
Bitcoin, on the other hand, continues to behave like a risk-on asset, closely mirroring stock market movements. Its 52-week correlation coefficient with the Nasdaq Composite index sits at 0.76, reinforcing its sensitivity to broader market trends.
Could Bitcoin Be Topping Out?
This breakdown in the Bitcoin-to-gold ratio bears an eerie resemblance to the 2021-2022 cycle, which preceded Bitcoin’s last bear market. Back then, a bearish divergence in the BTC/XAU ratio - rising prices alongside a declining relative strength index (RSI) - signaled fading momentum.
As a result, the ratio first dipped to the 50-period, two-week exponential moving average (EMA) before ultimately plunging 60%. That drop coincided with Bitcoin’s 68% decline against the US dollar.
Fast forward to today, and the BTC/XAU chart is showing similar warning signs. With RSI flashing bearish divergence once again, the risk of further declines looms large. If the ratio decisively falls below the 50-2W EMA support (around 26 XAU), Bitcoin could see increased vulnerability in dollar terms.
The next major downside target? Bitcoin’s 50-2W EMA sits below $65,000 - about 40% off its record high of $110,000 in January.
Bullish Revival or Bear Market Incoming?
Despite the bearish outlook, analysts at Nansen believe this could still be a correction within a larger bull market. If Bitcoin manages to hold above the 50-2W EMA, a bullish reversal remains possible.
However, if Bitcoin breaks below this level, the bearish case strengthens significantly. In that scenario, BTC’s downside target could extend to the 200-period two-week EMA - potentially sending prices as low as $34,850 if historical fractals repeat.
The coming weeks will be crucial in determining Bitcoin’s fate. Will it reclaim strength, or are we witnessing the early stages of a deeper correction? Stay tuned.
