The update from January 20 is below. This post was initially published on January 19.
Recent Trends: Bitcoin vs. Gold
Bitcoin and gold have diverged in recent months, with gold prices climbing significantly while Bitcoin’s value has plummeted. The depreciation of Bitcoin comes amid renewed concerns as U.S. President Donald Trump threatens to escalate tariffs against multiple NATO allies.
Market Fluctuations
In a dramatic overnight shift, the price of Bitcoin fell sharply, dropping from nearly $96,000 to just above $90,000 within moments. Concurrently, gold reached unprecedented heights following Trump’s tariff threats. Traders are now anticipating higher-than-expected inflation readings this week, raising fears of “unprecedented stagflation,” as highlighted by Bank of America’s CEO.
Warnings from Investors
Billionaire investor Ray Dalio, founder of Bridgewater Associates, has cautioned that the U.S. dollar’s recent weakness indicates the anticipated collapse of the dollar as the world’s primary reserve currency is “happening now.” He asserts that the existing monetary, political, and geopolitical orders are breaking down, which could lead to conflicts.
Economic Predictions
Last year, the U.S. dollar depreciated by nearly 10%, and further declines are expected, especially as gold and silver soar in value. Dalio refers to significant forces driving these changes as detailed in his book, *Principles for Dealing with the Changing World Order*.
Investor Sentiments
As the dollar faces its largest drop in over a month, Bitcoin’s value has dipped below $90,000, wiping out nearly all gains made in 2026, while gold reaches new peaks. Alex Kuptsikevich, an FxPro chief market analyst, pointed out that Bitcoin is negatively affected by these tariffs, which have triggered a “sell America” trend.
Implications Ahead
Economists from Barclays and Morgan Stanley have revised their forecasts for the December U.S. personal consumption expenditures price index (PCE) to 2.8% or 2.9%. Peter Schiff, a well-known gold investor, noted that the impending collapse of the dollar could induce skyrocketing consumer prices, further exacerbating stagflation concerns.
Future Outlook
As traders navigate through ongoing geopolitical uncertainties, Bitcoin’s future price movement remains uncertain unless there is renewed buying interest, with projected support at around $88,000. Experts believe that concerns surrounding the current geopolitical climate may intensify before any resolution is reached.
