Bitcoin Crash Looms as Gold ETFs Rally Skyrockets

In early March, Bitcoin faced strong resistance below the $85K mark, leading to market volatility and fear dominating sentiment. The cryptocurrency experienced a sharp decline after losing the critical $90K level, briefly dropping below $80K. Despite attempts by bulls to stabilize the price, selling pressure remained high, preventing a sustained recovery. At the same time, the average Funding Rate SMA (30) decreased by 9% since the beginning of March, indicating a negative sentiment dominating as traders increasingly bet on further downside. This trend confirmed bearish speculation driving the market for weeks.

As the bearish trend persisted, Bitcoin continued to trade at its lowest levels since late 2024 by the middle of March. The downtrend raised concerns about the sustainability of the current cycle, with the cryptocurrency down nearly 20% since the start of the month. Despite ongoing institutional adoption and potential catalysts for recovery in the long term, negative funding rates and weak market confidence posed challenges. Analyst Axel Adler highlighted the decreasing funding rates, suggesting a potential shift to negative rates if the trend persisted, signaling growing bearish sentiment and increased short positioning.

By late March, Bitcoin was trading at $83,600, struggling to overcome resistance at key moving averages. The cryptocurrency faced hurdles in reclaiming the 200-day moving average (MA) at $84,100 and the 200-day exponential moving average (EMA) at $85,500, with bears maintaining control. Reclaiming the $86,000 level and the crucial $90K mark were identified as essential for regaining bullish momentum and confirming a potential recovery phase. Failure to break above these levels raised the risk of further downside, potentially triggering another wave of sell-offs amid lingering macro uncertainty.

Meanwhile, gold ETFs saw increased inflows, surpassing Bitcoin ETFs amid a historic rally for the precious metal by mid-March. Rising gold prices and strong bitcoin ETF outflows contributed to this shift, with gold prices hitting record highs. Bitcoin faced a 19% drop over three months, contrasting with gold's 12.5% increase, highlighting the diverging trends between the two assets. The influx of funds into gold ETFs reflected a growing preference for the precious metal amidst market uncertainties, emphasizing the dynamic nature of investment choices within the evolving financial landscape.

Links to the stories discussed: - Can't Miss: Bitcoin Funding Rates Decline 9% In March – Will It Go Negative This Week? - Gold ETFs Inflow Takes Over Bitcoin ETFs Amid Historic Rally