Important points:
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Bitcoin ETFs had $839 million in inflows, while gold ETFs had losses of $4.1 billion.
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Historical patterns suggest that gold will rebound by 8.3% going forward.
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BTC is holding steady above technical support and is targeting $150,000 by the end of the year.
Just as its “digital” rival Bitcoin (BTC) is recovering lost ground, gold’s luster is rapidly fading.
Just a week after setting a record above $4,381, the precious metal fell more than 10.60% to $3,915 on Thursday, its biggest seven-day decline since April.
Gold’s correction coincided with a nearly 6.70% rise in Bitcoin prices, highlighting the sharp divergence between the US and China as they move closer to a trade deal.
The change follows Donald Trump’s remarks about his “great meeting” with Xi Jinping on Thursday, where the two leaders agreed to lower fentanyl tariffs from 20% to 10%, effective immediately.
As risk appetite improves and crypto markets heat up, is gold’s support below $4,000 a sign that traders are returning to Bitcoin in the coming months?
Bitcoin ETF attracts $839 million as gold plummets
Since gold hit a record high on October 20, U.S.-listed Bitcoin ETFs have absorbed $839 million in net inflows, with holdings increasing consecutively in the past four sessions, according to data from Farside Investors.
By contrast, gold-backed ETFs have experienced total outflows of about 1.064 million ounces (about $4.1 billion) since Oct. 22, according to Bloomberg data.
This includes the biggest single-day withdrawals in more than six months on Monday, when investors withdrew 448,000 ounces of gold exposure.
BTC technicals are currently pointing to a strong lower bound near $101,790.
This is consistent with the 20-week exponential moving average (20-week EMA, green wave) and the 1.0 Fibonacci retracement level. A break above the support confluence increases the chances of BTC reaching $150,000 by the end of the year.
Analysts at JPMorgan argue that Bitcoin prices remain undervalued compared to gold, and expect Bitcoin prices to reach $165,000 in 2025.
Gold has not yet peaked: Analyst
Gold prices have risen about 50% since the beginning of the year, supported by record central bank purchases, persistent fiscal imbalances and an ongoing “down trade” in which investors seek protection from rising government debt and fiat currency depreciation.
Metals trader David Bateman argues that despite the ongoing correction, the gold bull market remains fundamentally unchanged.
Additionally, technical analysis shows that gold is still in a bull market correction, holding firm above its 50-day exponential moving average (50-day EMA, represented by the red wave).
As you can see below, gold has bounced off its 50-day EMA support each time over the past two years, resulting in rallies between 4 and 33%.
Also, gold’s past 10% corrections over the past 30 years have consistently resulted in sharp rebounds within days, indicating that this is likely a short-term bottom rather than a more serious downside.
Related: Bitcoin-Gold Correlation Increases as BTC Follows Gold’s Path to Store of Value
According to data highlighted by Sabu Trades, the past 10 such crashes have all resulted in positive two-month returns, with an average recovery of 8.3%.
If this pattern holds, gold could revisit the $4,200-$4,250 zone by December, effectively retesting its all-time high and reaffirming gold’s broader uptrend.
As long as the metal outperforms the red wave, it could further reach HSBC’s $5,000 target in 2026.
This article does not contain investment advice or recommendations. All investment and trading moves involve risk and readers should conduct their own research when making decisions.