The chart is an effort to plot Bitcoin and Gold in a ratio to figure out potentially where we are.
The upper band (red) is where it becomes quite risky to hold bitcoin instead of gold.
Mind you this does not mean gold will give better returns but means if Bitcoin goes through a correction, Gold will likely hold stronger.
The green band is where Bitcoin becomes extremely less risky with a huge risk to reward ratio. Having said that, hoping that we will come touch green band is not always a good strategy as it has been proven it might reverse before touching green.
Another level to add to some Bitcoin to your position instead of Gold has been 200 Week Moving Average (200WMA) represented as blue line.
Historically it has been a good level to add Bitcoin instead of Gold. Although it is not a perfect indicator as well but it definitely makes considering Bitcoin vs Gold a little easier as it is a massive support.
As of now, we are not there yet but further downwards price action will take us there.
We can certainly come down and touch green band where it becomes a no brainer for me to allocate my capital to bitcoin instead of gold.
I do also notice the MACD is deeply red and quite oversold. A weekly candle showing reversal could be a good indication of trend reversal while still expecting some choppy price action.
Note: Green and Red bands are not drawn using logarithmic curves but rather connecting the closing price and trying to connect as many as points as possible. I am aware I might not have touched all points but this model is just a visual comparison of trend rather than targeting exact entry or exit points.
What do you think will play out? Tell me in the comments.
The upper band (red) is where it becomes quite risky to hold bitcoin instead of gold.
Mind you this does not mean gold will give better returns but means if Bitcoin goes through a correction, Gold will likely hold stronger.
The green band is where Bitcoin becomes extremely less risky with a huge risk to reward ratio. Having said that, hoping that we will come touch green band is not always a good strategy as it has been proven it might reverse before touching green.
Another level to add to some Bitcoin to your position instead of Gold has been 200 Week Moving Average (200WMA) represented as blue line.
Historically it has been a good level to add Bitcoin instead of Gold. Although it is not a perfect indicator as well but it definitely makes considering Bitcoin vs Gold a little easier as it is a massive support.
As of now, we are not there yet but further downwards price action will take us there.
We can certainly come down and touch green band where it becomes a no brainer for me to allocate my capital to bitcoin instead of gold.
I do also notice the MACD is deeply red and quite oversold. A weekly candle showing reversal could be a good indication of trend reversal while still expecting some choppy price action.
Note: Green and Red bands are not drawn using logarithmic curves but rather connecting the closing price and trying to connect as many as points as possible. I am aware I might not have touched all points but this model is just a visual comparison of trend rather than targeting exact entry or exit points.
What do you think will play out? Tell me in the comments.
Comment:
BITCOIN looking better in terms of Risk/reward than GOLD right now
Trade active:
Bitcoin is undervalued
Trade active:
I would choose Bitcoin over Gold based on the charts