Gold Takes a Breather While Bitcoin Gains Momentum Ahead of Key Fed Decisions

Bitcoin Rebounds as Gold Rally Pauses Ahead of Fed Decision

Gold’s historic surge hit a pause this week, ending an eight-week winning streak as traders took profits and repositioned ahead of the Federal Reserve’s October policy meeting. The pullback eased safe-haven demand and helped revive appetite for risk assets — with Bitcoin among the main beneficiaries.

Spot gold retreated more than 6% from Monday’s record high above $4,380 per ounce, closing the week near $4,120. The correction followed significant ETF outflows and an easing tone in U.S.–China trade relations, reducing the urgency for safety trades.

After talks in Malaysia, both governments said they had reached a “preliminary consensus” on several trade issues, including tariffs and export controls. U.S. Treasury Secretary Scott Bessent said President Donald Trump’s proposed 100% tariffs on Chinese goods were “effectively off the table,” signaling a thaw that lifted market sentiment.

The combination of trade optimism and expectations that the Fed will trim rates by another 25 basis points this week cooled the metals rally. Silver and platinum also slipped sharply, suggesting traders are locking in gains before Wednesday’s decision.

Bitcoin, meanwhile, gained fresh momentum. The world’s largest cryptocurrency climbed over 5% this week, breaking above $113,500 after trading sideways for much of October.

Data from CoinDesk analyst Omkar Godbole shows the BTC/gold ratio — a gauge of Bitcoin’s relative value against gold — recently flashed its most oversold signal in nearly three years. The ratio’s 14-day Relative Strength Index (RSI) sank to 22.20, its lowest since November 2022.

Historically, such extreme readings in the BTC/gold ratio have preceded periods of Bitcoin outperformance, as investors rotate back into higher-risk assets once macro stress subsides.

With gold cooling and central bank policy in focus, Bitcoin appears to be regaining strength as a proxy for renewed global liquidity and risk-taking.