Gold vs. Bitcoin: BTC and XAUUSD Consolidation Sets Stage for Next Rally

The US Commodity Futures Trading Commission (CFTC)’s plan to allow spot crypto asset contracts on registered futures exchanges could boost Bitcoin (BTC)’s institutional adoption. The move would integrate Bitcoin more deeply into traditional finance, increasing market credibility. Federal-level trading approval could attract larger investors and improve liquidity. Moreover, the stronger regulatory clarity may also reduce risks for institutional players, making Bitcoin a more attractive asset.

On the other hand, gold (XAUUSD) prices are showing bullish momentum after the employment data. A break above $3,450 in spot gold will initiate the subsequent surge in gold prices. Meanwhile, Bitcoin is preparing for the next rally by consolidating above the $105,000 level.

Bitcoin-to-Gold Ratio Signals Bullish Outlook for Bitcoin

Cup-and-Handle Pattern Suggests Breakout

The weekly chart for the Bitcoin-to-gold ratio shows an intense bullish price action, forming a cup-and-handle pattern. The ratio is currently trading near the 34 level. A break above the 40 area would be bullish for Bitcoin prices. This breakout could push the ratio toward the 110 level, signalling a strong surge in Bitcoin prices.

Inverted Head and Shoulders Pattern Strengthens Long-Term Bullish Case

The bullish price action is also observed in the chart below. In particular, the Bitcoin-to-gold ratio forms an inverted head and shoulders pattern. Notably, similar patterns emerged in 2015, 2019, and 2023, each indicating a bullish price outlook. Historically, breakouts from these patterns have triggered strong surges in Bitcoin prices. At present, the ratio is trading at the neckline of the inverted head and shoulders formation. If this level is breached, a breakout from the neckline will likely trigger a rise in Bitcoin.

Bitcoin Technical Analysis: Breakout Patterns Point to $140K

BTC Weekly Chart Shows Support at $110K Amid Volatility

The weekly chart for Bitcoin shows that the price has hit the $120,000 psychological level. After hitting this level, the price corrected toward the neckline of the inverted head and shoulders pattern around the $110,000.

A sustained support at this level will be a bullish sign for Bitcoin prices. However, a break below $110,000 could initiate further downside. However, the price actions show intense volatility, which indicates that prices may consolidate within wide ranges before the next bullish momentum.

BTC Bullish Patterns Support Medium-Term Upside

The weekly chart for Bitcoin shows that the price has broken above the resistance level of $115,000. This resistance is the neckline of the cup and handle pattern. The overall price structure remains firmly bullish, supported by the formation of the cup pattern and a breakout from the descending broadening wedge pattern.

A strong support zone is established between $65,000 and $67,500, suggesting that prices will likely remain elevated in the medium term. However, short-term volatility may push the price lower to attract new buyers. Any correction in Bitcoin could drive the price to new highs toward the $140,000 target area.

Daily Chart Highlights Key Support Zone for Next Rally

The daily chart for Bitcoin shows that prices are approaching the 50-day SMA support. This support also aligns with the neckline support of the inverted head and shoulders pattern. Bitcoin has strong support within the $105,000 to $115,000 range. If prices hold in this region, the next rally could target the two-year trendline near the $140,000 area.

Gold Technical Analysis: Consolidation Sets Stage for Breakout

XAUUSD Weekly Chart Shows Range-Bound Trading With $3,450 Resistance

The weekly chart for spot gold shows that the price is consolidating between the red dotted trendlines. These trendlines define the levels of $3,450, $3,250 and $3,175. A break above $3,450 would take gold out of this range and trigger a strong surge toward the ascending channel resistance around the $3,850 area. However, a break below $3,000 is unlikely but would be negative for spot gold.

Inverted Head and Shoulders Pattern Supports Bullish Outlook

The key levels for spot gold are shown in the weekly chart below. The chart indicates that gold has been consolidating between the $3,000 and $3,500 region. The peak formed in April 2025 has led to an intense consolidation phase. However, this consolidation is a positive sign, suggesting that the price is likely to break above the $3,500 level.

The chart also highlights intense bullish price action, marked by an inverted head and shoulders pattern with a breakout above $2,075. Historically, the price has consolidated before each breakout, and the current setup suggests that a break above $3,500 could take gold to new highs.