Throughout 2019, Bitcoin and gold became highly correlated, rising and falling in value at or around the same time, and further fueling the Bitcoin as a safe haven narrative.

Even now, the two assets are showing similarities in their price charts that suggests they are still correlated in some way, and gold could soon be following Bitcoin and making a “deep cycle low,” much like the leading crypto by market cap did last month.

Is The Precious Metal Ready To Set a Cycle Low in December?

As tensions between the US and China were heating up and fears of a looming recession mounted, 2019 has thus far been the year of the safe haven asset – namely, the precious metal gold and its digital gold counterpart, Bitcoin.

Related Reading | Bitcoin Could Follow Gold Fractal With 44% Drop to Under $7,000

The two assets rose and fell hand-in-hand as investors fled stocks and other traditional investments. Eventually, though, just as Bakkt launched in late September, Bitcoin diverged and dropped over $2,000 in less than 72 hours, erasing over 20% of its 2019 rally.

With the assets showing such similar performance, could Bitcoin somehow be a leading indicator for gold? Just before Bitcoin broke down, it had been consolidating at the top of its rally and trading inside a triangle pattern before its big fall.

Gold is very cyclical and is due a deep cycle low in Dec. working towards that. — Bob Loukas (@BobLoukas) October 13, 2019

According to gold charts, the precious metal is trading inside a very similar pattern and could be at risk for a deeper drop ahead.

Career trader and investor Bob Loukas backs up the theory, suggesting that gold is ready for a correction much like Bitcoin’s, and could put in a “cycle low” in December.

Investors Seeking Safe Haven Assets Driving Both Bitcoin and Gold

Although Bitcoin may appear to be acting as a leading indicator for gold currently – given the shape of the pattern gold is now trading in looking eerily similar to the formation Bitcoin just broke down from – the leading crypto by market cap has been following a fractal from gold’s price charts.

Even Bitcoin’s recent triangle pattern and drop were first seen on gold price charts, and if the fractal continues to be followed, it suggests a very long, drawn-out consolidation phase where Bitcoin trades mostly sideways – the epitome of max pain for those accustomed to the wild price swings and volatility in crypto markets.

Related Reading | Gold Fractal Predicted Bitcoin Distribution, Up Next Is Two Years of Sideways

The truth is, neither asset is likely to be following or leading the other, but due to their like-attributes they behave similarly. Markets and price fluctuations are driven by the emotional state of investors. And with each asset being attractive to the same sub-set of investors, the emotions driving each market are bound to be similar as well.

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