Bitcoin showed lackluster performance on August 16, as its price remained rangebound while gold surged to an all-time high. Despite avoiding a retest of $56,000 lows, Bitcoin’s inability to rally has left market observers unimpressed, especially as other assets, such as gold and equities, continue to outshine the leading cryptocurrency.
Bitcoin Struggles Amidst Market Gains
Data from TradingView highlighted Bitcoin’s (BTC) limited movement within a $1,500 intraday trading range, failing to capitalize on positive market conditions. Filbfilb, the co-founder of DecenTrader, remarked on X that Bitcoin’s failure to respond to the good news is a concerning sign, especially as gold hit a new record high of $2,500 per ounce. While gold has risen 21% year-to-date, Bitcoin has gained 38%, but it still lags behind in recent market momentum.
BTC/USD 1-hour chart. Source: TradingView
Calls for Patience as Bitcoin Lags Behind
Despite Bitcoin’s sluggish performance, Charles Edwards, founder of Capriole Investments, urged patience, noting that Bitcoin’s recovery from its August lows has been slower than other asset classes. Edwards suggested that Bitcoin could eventually follow gold’s lead, citing historical trends where Bitcoin lags behind gold by around three months.
Source: Peter Brandt
Bitcoin’s Correlation with Stocks and Future Outlook
Benjamin Cowen, CEO of Into the Cryptoverse, pointed out that Bitcoin’s current divergence from the S&P 500 mirrors behavior seen in 2019 when the U.S. Federal Reserve last cut interest rates. Cowen predicts that the positive correlation between Bitcoin and stocks could return by 2025, a timeline that aligns with the broader market cycle.
S&P 500 vs. gold vs. BTC/USD chart. Source: Charles Edwards/X
While Bitcoin continues to struggle, longtime analyst Tuur Demeester warned that the cryptocurrency might not be out of the woods yet, suggesting that a pullback to $45,000 is possible if there is a significant selloff in the stock markets. As the market watches, Bitcoin holders are advised to remain cautious amidst ongoing volatility.
