For some days now, there have been several positive signals regarding the price of Bitcoin, which, however, is not rising today.
In reality, several analysts did not expect a rise today, while things change if you look a little further ahead.
It is therefore necessary to make a clear distinction if one wants to understand why, despite the positive signals, the price of Bitcoin is not rising today.
The history of Bitcoin up to today
The key to understanding this apparent contradiction is the separation of the analysis by period, that is, short term versus medium term.
In the short term, two dynamics are still prevailing over the price of Bitcoin that have been influencing it for months now.
The first is the one related to the price of gold.
Bitcoin in the financial markets is seen as a risk-on alternative to gold, therefore in some ways similar, but fundamentally different.
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Furthermore, since mid-December there has been a strong growth trend in the price of gold, rather unusual, which clearly reveals that there is a flight from risk-on. Despite this, however, the price of Bitcoin, which is an absolutely risk-on asset, does not seem to have been affected much.
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In fact, the price of gold went from $2,600 an ounce on December 20 to the $3,500 an ounce all-time high recorded for a brief moment on April 21. During that period, the price of Bitcoin went from over $100,000 to less than $90,000, which is not an unusual fluctuation.
The fact is that in the same period, the Dollar Index also fell, against which in the medium/long term the price of BTC is inversely correlated. And so, while on one hand gold has probably drained capital from the Bitcoin market for months, on the other hand, the US dollar DXY index has prevented a strong decline, as it fell from 108 to 98 points.
The short term
These two dynamics are still continuing to act on the price of Bitcoin, even if this might be true only in the short term.
In particular, from Friday’s close at $3,240 per ounce, the price of gold today has risen to $3,260 per ounce, and although it is a very minimal rise, it had the strength to trigger a small decline in the price of Bitcoin.
The fact is that starting from April 23, the upward phase of the gold price that began after mid-December seemed to have ended, but starting from last Thursday, the subsequent downward phase seems to have interrupted.
In fact, the movements of the last two weeks fully fall within the ascending channel that began in the second half of December, so it is obvious that the markets are concerned that last week’s decline might ultimately turn out to be just a flash in the pan.
It should be added, however, that there are some analysts convinced that the 2025 peak of the gold price has yet to come, while others argue that a downward phase should instead begin shortly. On the other hand, the anomaly in the gold price is evident and very significant, perhaps even too much given the historical trend of this low-volatility asset.
Furthermore, several analysts expect a small and brief rebound of the Dollar Index, which is indeed underway since April 29, even if it is not particularly evident.
The medium term
In the medium term, however, the two dynamics mentioned above could reverse.
In other words, a bear phase in the price of gold could actually be triggered, even if such movements on an asset that is generally so little volatile often require relatively long periods.
To this, it should be added that the recent small rebound of the Dollar Index could also end up concluding within one or two weeks, and it could then resume the phase of decline that began with Trump’s inauguration at the White House in January.
Note that the decline of the Dollar Index is also unusual, because although it has not set any records, it is still much faster than those of the recent past.
The US dollar tends to be a very strong currency in the global financial markets, so it is unusual for its strength to decrease so quickly, even if in a still very limited way from a quantitative point of view.
All this means that in the short term the situation could remain similar to that of recent times for the price of Bitcoin, but in the second half of May things could change.
This is why it was perhaps excessive to hope for a rise in the price of BTC already today.
