Gold fell below its 200-day moving average (200DMA), a widely followed long-term technical indicator that tracks the average closing price over the previous 200 trading days.
A break below the 200Dma is often interpreted as a sign that long-term bullish momentum has weakened and a broader trend reversal may be underway. This is the first time gold has traded below its 200D dma since October 2023, with prices now sliding below $4,300 an ounce.
The drop follows a huge rally in which gold jumped nearly 200%, from less than $2,000 an ounce in October 2023 to a record high of $5,600 in January of this year. Much of this advance has been driven by “debasement trading,” the investment thesis that government spending, rising debt levels, and accommodative monetary policy would erode the purchasing power of fiat currencies, thereby increasing demand for scarce stores of value such as gold.
Gold has now entered bearish territory, having fallen more than 20% from its all-time high. The latest weakness follows a more positive-than-expected U.S. jobs report on Friday, which prompted markets to price in a greater likelihood of Federal Reserve tightening. The CME FedWatch tool now forecasts a 25 basis point rate hike in December, which would bring the federal funds rate to a range of 3.75% to 4.00%.
Silver, which is often considered a higher beta version of gold due to its greater volatility, is currently testing support at its own 200D MA, near $67 an ounce.
Bitcoin The gold ratio, which measures how many ounces of gold a bitcoin can buy, rose 3% in the past 24 hours to 14.72 ounces as bitcoin recovers toward $63,000.
Despite the rebound, the ratio remains about 70% below its December 2024 peak of about 41 ounces. Last month, the ratio was rejected at 200DMA, which preceded bitcoin’s decline below $60,000. However, the ratio remains above its February low, offering a modest sign of resilience for Bitcoin bulls.
Adding further pressure on risky assets, the U.S. Dollar Index (DXY) rose back above 100. A stronger dollar is typically a headwind for commodities, gold and cryptocurrencies, as it tightens global financial conditions, reduces liquidity and makes dollar-denominated assets more expensive for international investors.
