Gold Rally Puts Squeeze on Bitcoin as Retail Flocks to Safe-Haven Metal

Bitcoin's price dropped to a one-week low on Tuesday as investors' appetite for gold surged, pushing the precious metal to nine-week highs. The BTC/USD pair finished down 1.5% on Monday due to concerns over the US-Iran war and the Strait of Hormuz oil route impasse.

Data from TradingView showed Bitcoin abandoning a low-timeframe rebound to drop below $64,000. This move was likely influenced by increasing demand for safe-haven gold, which hit $4,435 per ounce on Tuesday - its highest level since June 5.

The retail sector is driving this interest in gold, with the NYSE ARCA-traded SPDR Gold Shares (GLD) exchange-traded fund attracting daily retail inflows of $50 million on August 5. This marks the highest single-day tally since mid-March for the largest US physical gold-backed ETF product.

The positive correlation between Bitcoin and gold remains intact, with CryptoQuant data showing a 90-day rolling basis. However, BTC/USD is contained by long-term trend line resistance near $66,000, which has kept price action in check ahead of the US CPI inflation print on Wednesday.