There is an indicator that almost no one looks at, but every time it reaches an extreme value, it later proves to be a turning point.
BTC/XAU — The ratio of Bitcoin to gold.
It's not about how many US dollars BTC is worth, but how many ounces of gold it is worth. The US dollar may be devalued, undergo quantitative tightening, and be distorted by policy. But gold will not. Therefore, weighing BTC with gold is much more honest than with US dollars.
Figure 1: Currently, 1 BTC can be exchanged for less than 20 ounces of gold.
The last time it reached this position was early 2020. The time before that was early 2019. What happened after these two times can be seen by flipping through the candlestick chart.
ETH is even more exaggerated, ETH/XAU plummeted from a peak of over 200 directly down to below 30, the price hit rock bottom.
But what I really want to talk about today is not this chart, but Figure 2.
Figure 2 shows the 30-day rolling correlation between BTC and gold and silver. Since March, there has been a subtle change: the correlation between BTC and gold has started to turn upward from negative values, approaching 0.5.
Why is this important?
Because BTC has two ways of "living": one is to follow Nasdaq as a risk asset; the other is to follow gold as a safe-haven asset.
In the past six months, it chose the former, so when US stocks fell, it also fell. But now, it is quietly changing tracks.
Every time BTC switches from "risk asset" to "hard asset" mode, it does not happen in the midst of excitement, but when no one is paying attention. Just like now.
Two charts, one conclusion: BTC is at the historical bottom of gold pricing, while re-establishing resonance with gold.
These two things happening simultaneously have only occurred once in the past six years.