Gold’s Rally Stalls as Traders Eye Fed; Bitcoin Regains Momentum as Risk Appetite Returns

Gold’s record-setting climb paused this week, snapping an eight-week winning streak as investors booked profits and shifted focus back toward risk assets ahead of the Federal Reserve’s October policy decision.

Spot gold fell more than 6% from Monday’s all-time high above $4,380 per ounce, ending the week near $4,120. The pullback followed heavy ETF outflows and a softer tone in U.S.–China trade talks, easing safe-haven demand that had fueled the metal’s surge.

After two days of discussions in Malaysia, officials from both nations said they reached a “preliminary consensus” on key trade issues, including export controls and tariffs. U.S. Treasury Secretary Scott Bessent added that President Donald Trump’s threat of 100% tariffs on Chinese goods was now “effectively off the table,” further reducing market stress.

The shift in tone, combined with expectations of a 25-basis-point Fed rate cut this week, dimmed gold’s near-term outlook. Silver and platinum also retreated, signaling a broader pause across precious metals after months of near-vertical gains.

Meanwhile, Bitcoin (BTC) capitalized on the easing risk aversion. The leading cryptocurrency rose over 5% in the past week, reclaiming the $113,500 level after a month of sideways trading.

According to CoinDesk analyst Omkar Godbole, the BTC/gold ratio — which measures Bitcoin’s relative value against gold — recently hit its most oversold level in nearly three years. The ratio’s 14-day Relative Strength Index (RSI) plunged to 22.20 last week, marking its weakest reading since November 2022.

Historically, such deeply oversold conditions in the BTC/gold ratio have preceded Bitcoin outperformance, as investors rotate back into higher-risk assets once macro uncertainty begins to ease.

With gold cooling and traders positioning ahead of Wednesday’s Fed decision, Bitcoin appears to be regaining its pulse as a proxy for improving global risk sentiment.