Why Silver Rally Could Be Canary in the Coalmine for Bitcoin & Altcoins
The post Why Silver Rally Could Be Canary in the Coalmine for Bitcoin & Altcoins appeared on BitcoinEthereumNews.com.
Key Insights Silver’s parabolic run could be good news for Bitcoin (BTC USD), and divergence suggests that liquidity rotation may start soon. Stagflation risks highlight key reasons behind the silver and gold rally, but cryptocurrencies remained subdued. How risk-off sentiment is heavily tied to Japan could see major moves after 19 December. Silver price action made headlines this week courtesy of its parabolic move and a new historic high above $64. There could be more to the precious metal’s latest performance than meets the eye, as some analysts believe it may be a precursor to crypto’s upcoming rally. Hawk-eyed analysts noted that Bitcoin (BTC USD) price action followed silver price with a bit of a lag in recent history. The correlation between silver and Bitcoin goes as far back as 2021. Bitcoin (BTC USD) mimics silver price action with a bit of a delay/ source: TradingView If history repeats, then Bitcoin could be headed for a rally in response to the recent silver upside. However, this delay could take weeks or months to manifest in BTC’s price action. This latest silver rally into new ATHs suggests that liquidity has been rotating away from gold. Perhaps an indication that liquidity may also rotate into other assets that are currently discounted. Why Silver and Gold Have Been Rallying, but Bitcoin (BTC USD) Was Left Behind Investors expected that the latest rate cut announcement by the FED and the end of QT would be favorable for risk-on assets. However, that was not the case, signaling that some other market forces were driving the market. Bitcoin price retreated by over 4% after the FED’s meeting, while silver and gold rallied. One of the key reasons behind this outcome was stagflation fears. The FED decided to cut rates while inflation was elevated. Moreover, this decision…
