Bitcoin Price Prediction as Rotation From Gold Continues

Key Insights

• Bitcoin price may rebound soon amid rotation from gold.
• Spot Bitcoin ETF inflows have continued growing this month.
• The GLD and IAU gold ETFs have shed substantial assets in this period.

Bitcoin price has pulled back recently amid the ongoing geopolitical concerns. BTC token dropped below the important support level at $70,000, reaching its lowest level since March 10. It has dropped by 45% from its highest point last year. However, this retreat may end soon as the rotation from gold continues.

Rotation From Gold to Bitcoin Continues

There are signs that investors are slowly moving from gold to Bitcoin, which may fuel the latter’s rebound in the coming weeks.

SoSoValue data shows that spot Bitcoin ETFs have continued adding assets this month. They have added $1.43 billion this month after experiencing four consecutive months of outflows.

These funds shed over $6 billion in assets between November and February, which coincided with the Bitcoin crash from $126,300 to $60,000. They now hold $90.3 billion in assets, with BlackRock’s IBIT holding over $54 billion.

The ongoing spot Bitcoin ETF inflows happened as investors continued selling gold, an asset widely seen as the best safe-haven. The gold price has dropped to $4,490, down 20% from the year-to-date high.

A closer look at the ETFs shows that the biggest gold funds have continued to lose assets in the past three consecutive weeks. Data compiled by ETF.com shows that the SPDR Gold ETF (GLD) shed over $2.3 billion in assets last week, the third consecutive weeks in the red. As a result, the fund has now lost $2 billion this year.

The iShares Gold Trust (IAU), the second-largest gold ETF, has lost assets for the past 6 consecutive weeks. It lost over $1.6 billion last week, a significant increase from the $1.2 billion it lost the week before. The fund has lost $2.58 billion this year.

Therefore, there are signs that investors are moving from gold assets to Bitcoin in the last three weeks. This also explains why Bitcoin has outperformed gold since the war began three weeks ago. Bitcoin has also outperformed the stock market, with key indices like the Dow Jones Industrial Average and the Nasdaq 100 nearing correction levels.

Strategy Continues to Accumulate Bitcoin

Meanwhile, Bitcoin is also benefiting from the ongoing accumulation by Michael Saylor’s Strategy, the industry’s largest treasury company.

In an X post on Sunday, Saylor hinted that the company continued buying Bitcoin last week. Chances are that these purchases were made using the STRC, its preferred platform.

The most recent reporting showed that the company bought 22,337 BTC for over $1.5 billion, its biggest weekly purchases in months. It now holds 761,068 coins worth over $52 billion.

Other companies are also continuing to buy Bitcoin even as it remains in a bear market. Metaplanet is also buying Bitcoin even as it remains in a bear market. It recently raised $255 million from global investors to buy Bitcoin. DDC Enterprise, another small treasury company, bought 200 coins, bringing its total holdings to 2,383.

All this buying has led to a sharp decline in Bitcoin supply in exchanges. There are now 2.47 million coins in exchanges, down from 3.31 million in April last year.

Bitcoin Price Technical Analysis

The 12-hour chart shows that the BTC price has held steady in the past few weeks. It has stayed in this range since February this year.

On the positive side, as we wrote on the MSTR stock forecast, it has slowly formed an inverted head-and-shoulders pattern, a common bullish reversal sign. It is now forming the right shoulder.

Also, the coin’s Supertrend indicator has remained in the red. Therefore, the coin will likely rebound in the coming weeks, potentially to this month’s high of $76,120.

A surge above this price will point to more gains, potentially to the key resistance level at $80,000 and above.

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