Gold Rally Faces Overheating Risk – Analysts Eye Bitcoin as Next Beneficiary
Gold prices have soared to new highs, but technical indicators suggest the rally may be nearing exhaustion.
According to recent data, the Relative Strength Index (RSI) for gold has surged to 91.8 – an extremely overbought level that has historically preceded sharp pullbacks.
The hourly gold chart shows that after peaking above $4,180, spot prices have started to cool, now hovering around $4,107. The recent upswing pushed gold into record territory, but traders are becoming increasingly cautious as momentum indicators flash warning signs.
Technical analysts note that such elevated RSI levels are rare and typically unsustainable. When RSI exceeds 90, it often signals an overheated market, prompting profit-taking and a potential correction.
Crypto Rover added that a short-term cooldown in gold could trigger a shift in capital flows back toward Bitcoin and other risk assets. Historically, when gold tops out after strong rallies, Bitcoin tends to attract renewed investor interest as traders rotate from defensive to growth-oriented positions.
Market watchers will be closely monitoring gold’s next move, with $4,100 seen as a key short-term support zone. A breakdown below this level could accelerate selling pressure, while a sustained rebound above $4,180 might prolong the rally temporarily before momentum fades.
As the precious metal faces potential resistance, crypto traders are preparing for a possible reallocation wave that could inject new liquidity into Bitcoin markets – particularly as volatility returns and macro uncertainty remains high.
The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.
Alexander Zdravkov is a person who always looks for the logic behind things. He has more than 3 years of experience in the crypto space, where he skillfully identifies new trends in the world of digital currencies. Whether providing in-depth analysis or daily reports on all topics, his deep understanding and enthusiasm for what he does make him a valuable member of the team.
