Bitcoin (BTC) is currently considered relatively lower compared to gold and the global money supply, which could signal a price reversal, according to Samson Mow, CEO of Bitcoin technology company Jan3.
“Currently, Bitcoin is trading about 24%-66% below its correlation trend with gold market capitalization or the global money supply. Meanwhile, gold is being valued higher than its average,” Mow shared in a post on X platform on Saturday.
Market data shows that April gold futures closed on Friday at $5,247.90. Meanwhile, PAX Gold (PAXG), a digital gold token, is trading at $5,404.14 at the time of writing.
Additionally, Mow mentioned Bitcoin’s Z-score, a metric that helps assess how close or far the BTC price is from its historical average. Specifically, a Z-score of 0 indicates the price is at the average, while a Z-score above 0 suggests the price is above average. Conversely, when the Z-score drops below 0, it indicates the price is below the average.
Bitcoin Z-score compared to gold | Source: TradingView Notably, Mow emphasized that when Bitcoin-to-gold Z-score drops below -2, Bitcoin often experiences strong rallies. Currently, the Z-score for this ratio is around -1.24.
Data from TradingView shows that this index fell below -3 in November 2022, amid the collapse of the FTX cryptocurrency exchange. Subsequently, BTC’s price increased over 150% in the following 12 months.
A similar scenario occurred in March 2020, when the COVID-19 pandemic caused the Z-score to fall below -2. At that time, Bitcoin bottomed at $3,717 but grew over 300% in the following 12 months, reaching an all-time high of around $69,000 in November 2021.
Could Bitcoin drop to $50,000?
Mow’s perspective offers a contrasting view to many analysts, who believe the cryptocurrency market may continue to face difficulties and that Bitcoin’s price could fall further due to investor uncertainty and global geopolitical tensions.
Some crypto market analysts predict that BTC could drop to $50,000, as current price action seems to reflect the bear market experienced in 2022.
In the past, Bitcoin has fallen more than 50% from its peak to trough, reaching a low of $60,000 before a slight recovery to its current level near $66,400, following recent volatility in the Middle East region.
Mr. Giao
Disclaimer: The information on this page may come from third parties and does not represent the views or opinions of Gate. The content displayed on this page is for reference only and does not constitute any financial, investment, or legal advice. Gate does not guarantee the accuracy or completeness of the information and shall not be liable for any losses arising from the use of this information. Virtual asset investments carry high risks and are subject to significant price volatility. You may lose all of your invested principal. Please fully understand the relevant risks and make prudent decisions based on your own financial situation and risk tolerance. For details, please refer to
Disclaimer.
Related Articles
STRC Halts Bitcoin Buys: Will BTC Price Dip Again?
Strategy paused its Bitcoin accumulation via STRC preferred stock after failing to raise fresh capital since Friday, signaling a notable shift after two weeks of aggressive buying. The pause comes as STRC traded below its $100 par value, a critical threshold that governs the company’s ATM issuance m
CryptoBreaking6m ago
Bitcoin Nears $75K as Trader Says BTC Price Squeeze Changes Nothing
Bitcoin extended a cautious rally at the start of the week, touching six-week highs as U.S. equities opened higher on signs of easing geopolitical tensions surrounding Iran. The move came alongside firmer price action
CryptoBreaking17m ago
'It's a Rug-Pull': Adam Back Issues Warning to Bitcoin Users Over BIP-110 - U.Today
Adam Back criticizes BIP-110, arguing it jeopardizes Bitcoin's stability by enabling potential risks like fund freezing and chain splits. He views it as an unnecessary response to spam that could harm users and damage Bitcoin's reputation.
UToday36m ago
Bitcoin Layer 2 Network Stacks Completes SIP-034 Upgrade, Network Processing Capacity Increases Up to 30x
Bitcoin Layer 2 network Stacks implemented SIP-034 upgrade on March 17, enhancing network processing capacity for certain DeFi applications by 30 times. By optimizing transaction processing limits, the upgrade significantly impacts complex DeFi applications and is expected to indirectly increase transactions and fees.
GateNews50m ago
A whale withdrew 217.7 BTC from a certain CEX half an hour ago, accumulating 2634.7 BTC over 14 days.
Gate News reported that on March 17, on-chain data shows that a certain whale/institution withdrew 217.7 BTC from a certain CEX half an hour ago, valued at $16.04 million. This address has been continuously withdrawing BTC from the exchange since March 3, accumulating a total of 2634.7 BTC over 14 days (total value of $186 million), with an average cost of $70,805 per coin, and currently has unrealized gains of $9.05 million.
GateNews1h ago
