- Bitcoin retreated by more than 2.5 percent in the early London trading session on profit-taking sentiment.
- The plunge almost mirrored a similar downside move in spot gold as the precious metal corrected lower shortly after coming at a striking distance of $2,000 an ounce.
- Analysts at JP Morgan & Chase warned about gold peaking out, stating that the metal would trade downwards later in 2020.
The price of Bitcoin dropped by more than 2.5 percent in the first hours of the London trading session Tuesday on profit-taking sentiment.
The BTC/USD exchange rate climbed more than 11 percent to hit a year-to-date high of $11,420 on Monday before retreating back by 2.83 percent to $10,736 a day later. The pullback reflected traders’ inclination to liquidate their positions at the said price top.
Bitcoin-Gold Correlation
Incidentally, Bitcoin’s intraday price trend mirrored that of gold, a rival safe-haven asset. Like the benchmark cryptocurrency, the precious metal too corrected lower upon hitting its all-time high of $1,980.57 an ounce. That was partially due to a growing correlation between gold and Bitcoin, according to data fetched by Skew.
Bitcoin-Gold one-month realized correlation hits 64.3 percent. Source: Skew
The proximity between the two left Bitcoin exposed to the macro fundamentals that drive gold prices.
In the short-term, the precious metal looked towards extending its rally owing to
Discussion about this post