The past 24 hours have proven very interesting for the XAU/BTC market. Whereas many expected gold to bounce back strongly against Bitcoin, that is not the case. There is room for cautious optimism, however.
XAU/BTC Shows no Major Signs of Recovery
Over the past few days, the ratio between gold and Bitcoin has tipped in favor of the world's leading cryptocurrency. As outlined in yesterday's analysis, the sudden BTC price drop has not affected this ratio in a negative manner. However, the ratio isn't improving further in favor of Bitcoin either, primarily because the $10,000 level needs to be reclaimed before that can happen.
Keeping that in mind, yesterday's second big gold dip came as some sort of "relief" in this regard. Gold bounced below $1,700 for a little while, but is now mounting a slow and steady comeback. That explains why XAU/BTC has moved up by 0.9% in favor of the precious metal. Bitcoin's price has remained virtually unchanged, thus this market can still easily head in either direction at any given moment.
Bollinger Bands: On the daily XAU/BTC chart, there is little to no change as far as the Bollinger Bands are concerned. This may hint at some degree of accumulation taking place, although no one can accurately predict in which direction the chart will evolve. Based on the current momentum, a small push to 0.1785 is not out of the question, assuming gold can remain above $1,700.
Moving Averages and RSI: No change here either, as the MA20 and MA200 remain vertical and still run in parallel. The only change is how the MA50 keeps moving lower, indicating that it may cross the MA200 this week. Given how small the "body" of the red candles is getting, this weekend should prove to be rather interesting.
Gold Price Notes a Flash Dip
Due to the ongoing uneasy affecting the Bitcoin price, gold appeared to be in a prime position to reclaim lost momentum in the XAU/BTC segment. That hasn't been the case, as the value of the precious metal went through a strong dip last night.
Even though things looked bleak for a moment, the price didn't stay below $1,700 an ounce for too long. Gold futures also lost some momentum, but they too remain above $1,700 for the foreseeable future. For now, both Bitcoin and bullion seem to cancel one another out in the XAU/BTC pairing, but that will not be the case for much longer.
