Can Bitcoin Recover as Gold Price Pulls Back From Record Highs?

Key takeaways:

• Gold’s ongoing pullback could trigger Bitcoin’s rebound, according to multiple analysts.

• Rallying to $150,000–$165,000 by year’s end is still possible, based on technical analysis.

Bitcoin (BTC) is showing signs of bottoming out as the rally by its analog rival, gold (XAU), is starting to look increasingly overextended.

Bitcoin hints at “generational bottom” as gold dips

Gold’s rally appears to have stalled after hitting an all-time high of around $4,380 per ounce on Friday, given it has dropped 2.90% ever since. Still, the precious metal was up by over 62.25% year-to-date.

Its daily relative strength index (RSI) readings have been persistently above 70 in the past month, indicating that the asset is overbought and risks profit-taking.

Bitcoin has jumped by almost 4% during gold’s correction period, recovering from its worst level in four months near $103,535. Its RSI reading is also at its lowest since April, mirroring a bottom structure that preceded a rebound of 60% or more in the past.

To some analysts, this inverse behavior suggests that the Bitcoin price is bottoming.

That includes analyst Pat, who predicted a “generational bottom” for Bitcoin, citing its performance relative to gold over the past four years.

The Bitcoin-to-gold ratio has plummeted to levels historically associated with market bottoms, last seen in 2015, 2018, 2020, and 2022. Each time, Bitcoin followed with rallies between 100% and 600%.

As of mid-October, the ratio has once again dipped below –2.5, signaling that BTC may be undervalued versus gold after the metal’s record run to $4,380. That may mark the beginning of Bitcoin’s next bull phase.

For analyst Alex Wacy, gold’s pullback is similar to its 2020 peak that coincided with a local Bitcoin bottom. The question now is whether gold will once again mark the bullish reversal for BTC.

HSBC predicts gold is not topping out yet

Contrary to the growing view that gold’s record run may be cooling, HSBC has doubled down on its bullish outlook, projecting that the precious metal could climb as high as $5,000 per ounce by 2026.

The bank based the bullish outlook on geopolitical tensions, economic uncertainty, and a weaker US dollar, which it said would keep demand strong.

Unlike previous rallies, this one is expected to be driven by long-term investors seeking portfolio stability, rather than short-term speculation.

Gold’s 2025 rally has seen several overbought corrections, but each dip resulted in the price going even higher.

The pattern reflects sustained investor confidence amid geopolitical and monetary uncertainty, the very conditions HSBC says will keep the rally alive into 2026.

Bitcoin’s own outlook remains highly optimistic, with JPMorgan analysts predicting BTC will reach $165,000 in 2025, arguing it remains undervalued relative to gold.

Related: Bitcoin trader says ‘lock in’ as dip-buyers enter below $110K

Similarly, analyst Charles Edwards noted that a decisive breakout above $120,000 could propel BTC toward $150,000 “very quickly.”

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.