At the beginning of the week, spot gold was trading at $1,813. Seven days later, it reached $1,988, up 9.65% against the US dollar. The rise of gold comes at a time when confidence in the global banking system is at an all-time low and five major banks are receiving bailouts. Analysts draw attention to three investment instruments.
Gold faithfully pursues the destruction of purchasing power!
cryptocoin.comAs you follow, the price of gold is approaching $2,000 after multiple US and international banks showed signs of extreme weakness. By lending banks $164.8 billion in five days, the Federal Reserve erased almost 50% of the US central bank’s monetary tightening policy. As a result, the market is not expecting a dovish rate increase of around 25 basis points, or even no rate increase at all, this month after the financial disaster facing the banking sector. This is ‘good news for gold’, according to Bart Melek, head of global commodity strategy at TD Securities. In this context, Melek makes the following assessment:
Markets conclude that the Fed will raise another 25 basis points and then probably sit on it for a while and wait to see what happens. From a gold perspective, given the disruptions in the banking system and the willingness of the U.S. Treasury to help, we can adapt that allows inflation to stay at a higher level longer.
Gold is up 9.65% against the US dollar last week, and silver is up 12.61% in the past seven days. Meanwhile, the US Dollar Index (DXY) fell from 105.65 at the start of the week to its current level of 103,864. Statistics analyst and market action forecaster Northstar tweeted 21 days ago about gold’s performance over the years compared to DXY. Northstar said at the time, “DXY was 105 in 1974 and gold was $150. In 1981, DXY was $105 and gold was $450. Today DXY is 105, and gold is $1,810. Don’t be afraid of the rising US Dollar Index. Over time, gold faithfully follows the destruction of purchasing power,” he wrote.
Yellow metal, like a ‘resting bull’!
Mike McGlone, senior macro and commodity strategist at Bloomberg, referred to gold as a ‘resting bull’ on March 15, three days ago. In this regard, McGlone underlined the following:
Compared to most risky assets and commodities that have bounced back from overexpansion due to the excess liquidity associated with the epidemic, gold looks like a rare stagnant bull market. Falling crude could be part of the deflationary spark to push the metal past the $2,000 resistance. If history is any guide, then 300 rapidly falling commodities, a banking crisis and Fed tightening are in stark contrast. This could trigger a Fed pivot that pushes gold higher.
Three in one: Gold, silver and Bitcoin
Richard Mills, owner of forwardoftheherd.com, said on Friday that he believes silver’s rise is without exaggeration. “Current indicators show that silver is well below value,” Mills said. Based on this, Mills made the following statement:
Currently, on the morning of March 17, the gold-silver ratio is 88:1, so it takes 88 ounces of silver to buy one ounce of gold. This means that once gold reaches $2,000 per ounce, ‘silver will rise 147% to about $30 per ounce. The silver-gold ratio dropped from 100:1 to just over 64:1. A significant increase in the value of silver ‘could easily happen again.
Many gold and silver advocates have high hopes for precious metals going forward. In addition, McGlone believes that gold will be affected by current macroeconomic events, while the market strategist thinks that banking problems could be a decisive moment for Bitcoin (BTC). In this regard, McGlone shared the following:
Bitcoin may be moving forward to trade in US Treasury long-term bonds and gold as banks come under stress following the collapse in bond prices. Continuing above $25,000, Bitcoin is a clear sign of a different strength.
Contact us to be instantly informed about the last minute developments. twitter‘in, Facebookin and InstagramFollow and Telegram And YouTube join our channel!
Risk Disclosure: The articles and articles on Kriptokoin.com do not constitute investment advice. Bitcoin and cryptocurrencies are high-risk assets, and you should do your own research and due diligence before investing in these currencies. You can lose some or all of your money by investing in Bitcoin and cryptocurrencies. Remember that your transfers and transactions are at your own risk and any losses that may occur are your responsibility. Cryptokoin.com does not recommend buying or selling any cryptocurrencies or digital assets, nor is Kriptokoin.com an investment advisor. For this reason, Kriptokoin.com and the authors of the articles on the site cannot be held responsible for your investment decisions. Readers should do their own research before taking any action regarding the company, assets or services in this article.
Disclaimer: Advertisements on Kriptokoin.com are carried out through third-party advertising channels. In addition, Kriptokoin.com also includes sponsored articles and press releases on its site. For this reason, advertising links directed from Kriptokoin.com are on the site completely independent of Kriptokoin.com’s approval, and visits and pop-ups directed by advertising links are the responsibility of the user. The advertisements on Kriptokoin.com and the pages directed by the links in the sponsored articles do not bind Kriptokoin.com in any way.
Warning: Citing the news content of Kriptokoin.com and quoting by giving a link is subject to the permission of Kriptokoin.com. No content on the site can be copied, reproduced or published on any platform without permission. Legal action will be taken against those who use the code, design, text, graphics and all other content of Kriptokoin.com in violation of intellectual property law and relevant legislation.