The logic is simple. BTC has underperformed gold, technology stocks and just about everything this year, which makes it look oversold and attractive relative to these assets.
But Brandts technical analysis suggests that the expected rotation may not happen and gold's outperformance relative to BTC could continue.
The momentum shift
A closer look at the XAU/BTC chart helps understand Brandt's bias for gold. XAU/BTC tracks the per-ounce price of gold in BTC terms.
For over a decade, XAU/BTC trended lower, illustrating the cryptocurrency's relentless outperformance and rally against the yellow metal. However, since at least 2019-2020, the pace of decline in the ratio has markedly slowed.
In technical analysis terms, this represents a loss of bearish momentum in the ratio. A flattening curve has replaced the steep, vertical drops that characterized the 2010s, a sign that the sellers of gold (relative to bitcoin) are finally exhausted.
And now, the tide seems to be turning in favor of the yellow metal.
XAU/BTC. (Peter Brandt, TradingView)
The “rounding” effect Brandt highlighted suggests the ratio's fall has not just stopped; it is beginning to curl upward.
In other words, we could be entering a new macro cycle where gold begins to claw back the ground it lost to bitcoin over the last 15 years.