I noticed an interesting trend in the market over the past few months. Bitcoin futures have been trading in the oversold zone for several months, and capital is actively migrating into gold and silver. Analysis shows that futures have decreased by more than two standard deviations from the 20-day moving average, a classic signal of excessive selling pressure.

What’s interesting is that gold ETFs attracted about $8.7 billion in the fourth quarter of 2024, a 47% increase year-over-year. Silver funds received $2.3 billion. At the same time, open interest in Bitcoin futures fell by 15%, and trading volumes decreased by 22%. This is no coincidence.

Institutional players began reallocating their portfolios as early as August 2024. Hedge funds reduced their crypto positions by an average of 23%, retail traders followed suit with a delay, but their sales increased by 34% by the end of the year. Geopolitical tensions, rising interest rates, and ongoing inflation concerns have all pushed investors toward traditional assets.

What was previously called "digital gold" is now being reevaluated by investors based on fundamental characteristics. Gold showed 12% volatility over 60 days at the end of 2024, while Bitcoin’s volatility was 68%. When market risk increases, the choice is obvious. Moreover, gold maintains a negative correlation with the dollar, and Bitcoin has become unpredictable.

Technical levels to watch: Bitcoin needs to rise above the 200-day moving average to recover, and gold must hold resistance above $2,100 per ounce. The relative strength between these assets is currently in favor of gold to the greatest extent since 2020. Historically, such rotations lasted about nine months, but current conditions could extend this period much longer. I will be monitoring ETF flows—they often give early signals of a trend reversal.