Compared to last week, very little has changed in terms of the XAU/BTC market. Although the gold price is showing ample bullish signs, Bitcoin is seemingly looking to do the same in the near future.
XAU/BTC Momentum Leans Toward Gold
For quite some time now, the XAU/BTC trading pair has been on the decline. Ever since reaching a high of nearly 0.3 in mid-March 2020, things have certainly improved for Bitcoin. The ratio is on an ongoing decline when looking at the weekly chart, and currently sits near 0.177. This is despite the gold price moving past $1,720 an ounce again, whereas Bitcoin still struggles to break and retain that illustrious $10,000 mark.
On the daily chart, however, things are looking a bit more interesting. Although the candle's body is very minimal, it would appear that the ratio may shift a bit in favor of gold once again. For the day, there is a 0.8% increase, which is not necessarily all that spectacular. However, given how the market has evolved in recent weeks, these small victories can start adding up very quickly.
Bollinger Bands: Very narrow BBs are still in place for XAU/BTC at this time. Whether this hints at accumulation or a simple disinterest in trading between these two assets, is a bit unclear. For now, there doesn't appear to be any real volatility spike on the horizon. More sideways action between 0.175 and 0.18 seems the most likely outcome for the coming week.
Moving Averages and RSI: No real changes can be noted here either. The MA20 remains well below the MA200 and is still angling down slightly. For the MA50, the bearish crossover with the MA200 has yet to materialize, which might give speculators some hope of seeing XAU/BTC shift in favor of gold. All of this will come down to what happens to the Bitcoin price in the foreseeable future.
What is Going on With Gold?
Explaining this minor shift in favor of the world's leading precious metal is not difficult. Some economies may be showing signs of a post-COVID-19 recovery, yet the real damage has yet to become apparent. That said, the demand for gold isn't slowing down. In fact, many investors still see it as the safe haven during times of financial uncertainty. Bitcoin still has to live up to those expectations, yet it remains incredibly volatile.
In other news, the XAU/BTC ratio may face some bearish pressure in the coming days. Investors are seemingly pulling out of gold [futures products] in favor of silver at this time. Silver has performed much better than gold in terms of Comex July contracts, indicating that a potential market shift may occur very soon.
