Pepperstone says the markets for precious metals like gold and crypto are seeing a ‘hidden climb’. But does this mean that investors are stepping up their hedge game? Pepperstone head of research Chris Weston’s gold, silver and Bitcoin assessments and expectations cryptocoin.com We have prepared for our readers.
“I definitely see gold as a better portfolio hedge”
“There’s been a sneaky climb in crypto and precious metals lately, but they’re on the radar,” said Chris Weston, noting that they control more airtime in their social media/trade offices. Markets seem worried about the US inflation data scheduled for release today and what it will mean for the Fed’s March meeting. Chris Weston comments:
I will refrain from saying that both markets are bought as an inflation hedge, as there is little correlation between crypto/gold and expected inflation. I definitely see gold as better portfolio protection against a central bank spinning in their stance and a potential march.
Chris Weston says that when rate hike pricing is so rich across the entire spectrum of developed markets and yield curves flatten, maybe it makes sense to buy some insurance against repricing across a broad portfolio.
In both cases, gold and silver are finding buyers despite high US real rates and a modestly strengthened USD.
Gold looks to test its resistance at $1,847, according to Chris Weston
According to the CME Fed Monitoring Tool, market participants are pricing in a 26.9% chance of a 50 basis point hike in March. These expectations will gain more popularity if inflation comes in hotter than expected. Currently, market consensus forecasts are that annual inflation in the US will rise to 7.3% in January. Chris Weston says he wants to test the resistance of gold at $1,847 and silver finds support at $22.40:
Silver found much buying support at $22.40 to $22.00 and the price consolidated later on before buyers stepped up their game. We broke past the 38.2% Fibos of the late January drop and now the near-term target is $23.60. The yellow metal is looking to see the downtrend resistance at $1,847 once again, a level that seems crucial for the gold market.
Chris Weston: Bitcoin is an acceleration tool for me
The Pepperstone head of research adds that Bitcoin’s trading pattern looks solid as it struggles to break above the $44,000 mark.
I don’t care about the shape of ETH, but Bitcoin looks interesting here with its price breaking the 44k mark and the supply zone seen throughout January. He rallyed for five days and had his best run since September. Bitcoin is an acceleration tool for me, I just go long when it’s going up and short when it’s down. Simple but crypto serves me well when it is a pure flow type tool that hitchhikes and aligns with the collective thoughts of the market.
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