Bank of America strategist Michael Hartnett has turned bullish on gold, urging investors to buy the metal as a hedge against rising U.S. debt. The call lands as the XAU/BTC ratio hits a 10-week high, with gold outperforming Bitcoin while the cryptocurrency stays stuck in a range.
BofA Strategist Calls Gold a Hedge Against Rising Debt
Hartnett laid out his bullish case in a report titled "Strife Begins at Forty," where he said the U.S. national debt will reach $40 trillion by August 26 and that the dollar will likely depreciate as a result. He added that the bond market will likely collapse.
Heavy spending on AI has pulled money away from the bond market, Hartnett said, and as pressure on it builds, according to CoinGape, he called gold the "optimal solution." Still, Bank of America trimmed its 2026 gold target from $5,093 to $4,360 a month earlier on the likelihood the Federal Reserve hikes rates this year.
The Fed releases its July FOMC minutes on August 19, and a hawkish tone that raises the odds of a September rate hike could weaken the bull case for both gold and Bitcoin.
Gold Outpaces Bitcoin as XAU/BTC Hits 10-Week High
The XAU/BTC ratio has climbed from $0.0606 on July 21 to $0.069, a 15% rise that puts it at its highest point since June 9. Gold itself dropped to a 2026 low of $3,942 on June 30 before gaining 11.7% to trade at $4,407 after US-Iran talks cut the odds of a September Fed hike. Bitcoin, by contrast, remains stuck between $62,000 and $65,000.
Billionaire Ray Dalio has also said gold could outperform Bitcoin over the long term as investors de-risk from an AI trade that CoinGape says is already showing signs of a bubble.
Bitcoin Nears a Bearish Crossover Despite a Double Bottom
Bitcoin has formed a double bottom pattern on the one-week chart, a setup that often signals a shift from bearish to bullish if the price holds support at $59,000. However, the 50-week moving average is dropping toward a bearish crossover below the 150-week moving average, a move that would invalidate the bullish signal.
An RSI reading of 39 also favors bears, leaving Bitcoin range-bound even as buyers defend the $59,000 support. A move above $65,500 would support the bullish case, but Bitcoin still needs to close above its 5-week moving average of $81,500 to confirm a longer-term shift toward bulls.
Source: CoinGape
Trading involves risk.
Risk Disclaimer
