Bitcoin and precious metals enter correction phase: XAU chart suggests downward pressure and buying opportunities

As tensions between the US and China ease, market anxiety diminishes and capital rotation accelerates. Bitcoin and precious metals markets are approaching a delicate turning point. While bullish voices remain, technical indicators suggest that we cannot overlook the risk of a correction.

Silver: Sell signal triggered, potential 7% decline

The silver market should be monitored similarly to the XAU chart. The RSI indicator suggests a bearish crossover, and historical patterns show that each time this signal appears, prices tend to decline in tandem.

From the current levels, the immediate target for silver is $47.41 (78.6% Fibonacci retracement). In the worst-case scenario, prices could fall to $45.51, representing approximately a 7% drop from current levels.

However, there is still potential for a bullish pullback. The 50-day and 200-day moving averages at $48.16 and $47.73 are acting as support levels, and buying pressure from these points could trigger a rebound.

If buyers can turn the 61.8% Fibonacci retracement level into support, silver could rise toward $49.9 (a resistance zone where the 50% Fibonacci level overlaps with the 100-day moving average). Breaking above this level would then target the next resistance at $51.01 (38.2% Fibonacci), about 5% higher than current prices.

Gold: Consolidation likely to break downward

Gold prices have shown weakness after several weeks of gains. The uncertainty surrounding the US-China trade war has dissipated, removing a key bullish catalyst.

Looking at the XAU chart, a breakout from the descending parallel channel appears likely to be short-lived. The RSI is trending lower and is below 50, indicating a clear loss of momentum.

If the price closes below $3,971 on the hourly chart, a bearish bias will be confirmed. However, the bullish volume profile indicated by the gray horizontal bar is supporting the current level, preventing a complete collapse for now.

If buying pressure surpasses selling momentum, gold could break out of the consolidation phase. A confirmed breakout above $4,046 on the hourly chart would signal this.

Bitcoin: Bearish resistance at $111,999, increased correction risk

Bitcoin has been following the upward trendline since October, continuously making new highs, but its gains are firmly capped at $111,999. Currently, the bearish (yellow horizontal bar) zone is defending just above this level, increasing the likelihood of a correction.

With the RSI at 46, there may not be enough momentum to break through the $111,999 resistance. In fact, BTC price is expected to face a pullback at this level.

The immediate support line is the 9-day moving average at $111,281. As long as this moving average continues to track the price from above, downside pressure remains. Each attempt for the price to return to the moving average faces selling pressure that suggests a continued downtrend.

Latest data reports the current BTC price at $90.31K (24-hour change: -0.87%), with a widening gap from the technical levels mentioned earlier.

If the upward trendline breaks downward, BTC could find initial support at $106,234, or in a worst-case scenario, fall to $100,718.

Conversely, if buying pressure increases and BTC breaks above the $111,999 resistance, a retest could push prices toward $117,552. In a very bullish scenario, reaching $123,084 is also possible. A sustained daily close above $123,891 would mark a genuine breakout, paving the way to reclaim the all-time high of $126,199.

Industry analyst Ted comments, “Bitcoin’s outperformance might occur when the US government shutdown ends,” indicating that resolving policy uncertainties could serve as a trigger.

Overall market outlook: Corrections as a prelude to growth

Currently, the market environment reflects a capital rotation driven by the easing of US-China tensions. Bitcoin, gold, and silver are all exposed to short-term correction risks, but this does not necessarily signal a bearish trend. Instead, it can be viewed as a consolidation phase ahead of the next upward cycle.

Monitoring the movements of precious metals, including the XAU chart, and observing whether key support levels hold will be crucial for future developments.