BTC struggles above 110k as Gold & Silver hit record highsThe precious metals are the asset of choice in the debasement tradeBTC’s main value proposition is a store of value, but trades like a risk assetFundamentals & debasement trade support BTC long termNear-term headwinds include US-China trade tensions & a Fed & data blackoutGold has continued to surge, rising above $4200 for the first time in history. Silver has also broken through the psychological barrier of $50 to reach a record $53, yet Bitcoin struggles to gain traction and has slipped back to 110k.The Gold and Silver rush shows no signs of cooling off. Silver has surged 83% and Gold has risen over 60% this year, significantly outperforming US equities, which trade 13% higher this year, and Bitcoin, which has only advanced 10% year to date.Gold and Silver are undoubtedly the assets of choice amid ongoing trade tensions between China and the US, geopolitical uncertainty, and expectations that the Federal Reserve will continue to cut rates, with two more 25 basis point rate cuts expected before the end of the year.Furthermore, the precious metals have benefited from the debasement trade, as investors move towards tangible assets amid growing concerns over fiat currency devaluations. Global debt has ballooned beyond $37 trillion, deficits are surging, and inflation, although lower, continues to erode purchasing power. The USD has recorded its largest first-half fall in 50 years, and investors are rotating into hard assets. The debasement trade is a bet against the government’s ability to manage its finances.Is Bitcoin Still in the Debasement Trade?Yet Bitcoin hasn’t benefited in the same way from the debasement trade. In the same week that Gold and Silver powered to fresh record highs, Bitcoin plunged by $10,000.While Bitcoin’s main value proposition is a store of value and protection against debasement, it tends to trade in line with tech stocks and risk assets. The massive liquidation event last week, which was linked to leverage rather than fundamentals, does little to support BTC’s store of value narrative. Furthermore, BTC/XAU has broken below a key support on the weekly chart.That said, the fundamental backdrop and rising global liquidity remain supportive for BTC, and the debasement trade, which has a long-term outlook.Near-Term BTC HeadwindsNear-term BTC will take some time to recover from its leverage flush out, and US-China trade tensions could weigh on the price. Trump and China’s Xi Jinping are scheduled to meet later this month in South Korea. Furthermore, with the Fed in blackout mode ahead of the October rate decision and the US data scarce due to the government shutdown, positive catalysts may be in short supply.On-chain data also gives reason for caution. CryptoQuant data shows that dormant whales are waking up, suggesting they may take action. Inflows from whale wallets holding over 1000 BTC surged following the October 11 selloff. A rose in whale inflows is often a near-term bearish signal, as they may be preparing to sell.Bitcoin Technical AnalysisBitcoin faced rejection from the 100 SMA at 115.4k and rebounded lower to test the multi-month rising trendline and the 100k psychological level.Sellers supported by the RSI below 50 will look to break below this key support zone. A close below 110k could open the door to 107.2k, the 200 SMA, and the August low. Below here, 100k is back in play.Should the 110k support hold, buyers will need to rise above the 50 SMA at $115.4k.More analysisDisclaimer: The content provided here is for informational purposes only and is not intended as personal investment advice and does not constitute a solicitation or invitation to engage in any financial transactions, investments, or related activities. Past performance is not a reliable indicator of future results. The financial products offered by the Company are complex and come with a high risk of losing money rapidly due to leverage. These products may not be suitable for all investors. Before engaging, you should consider whether you understand how these leveraged products work and whether you can afford the high risk of losing your money. The Company does not accept clients from the Restricted Jurisdictions as indicated on its website / T&Cs. Some services or products may not be available in your jurisdiction. The applicable legal entity and its respective products and services depend on the client’s country of residence and the entity with which the client has established a contractual relationship during registration.