Inverse Relationship Between Gold And Bitcoin Continues To Widen
August 10 2021 - 6:00PM
NEWSBTC
Bitcoin was trading north of the $40,000 levels, as it managed to
break above key resistance. The first cryptocurrency by market cap
sits at $45,044, at the time of writing, with small losses after a
strong rally pushed it high from the lows at $30,000. Bitcoin and
the crypto market have been negatively reacting to the events
coming from Washington as the Senates approved the infrastructure
bill without the amendments to exclude certain entities from tax
requirements. The fight will continue in other government
institutions. Our effort to get a vote on a digital asset fix
failed because other senators refused to set aside their
disagreements to support something they could actually agree on.
Thanks @SenToomey for explaining this at the end of our effort on
the floor.https://t.co/Lok8EWK1Eb — Senator Cynthia Lummis
(@SenLummis) August 9, 2021 Despite the news, BTC has held support
at its current levels. In the meantime, other commodities as taken
a turn to the downside. After a major rally during March and May
2021, Gold (XAU) fell from $1,800 to its current price at $1,731
strengthen the theory that there is an inverse correlation between
the precious metal and Bitcoin. Trader Adam Mancini believes Gold
crashed after it failed to clear its 200 daily moving average (DMA)
and losing support north of $1,830. Mancini expects the precious
metal to hold support at $1,745 or it risked to dropped further to
$1,690. The critical area to watch for the bulls stands at $1,795.
The trader added: If $1690 fails from here its a long way down to
$1575 next major support. As posted bulls will need to recapture
some levels to confirm a bottom. $1750 a good start, but getting
back above $1770 would be massively bullish now and trigger a new
leg higher. Mancini noted that Gold has been showing signs of
weakness as Bitcoin rallied from the bottom of its previous range.
However, the trader doesn’t rule out a break in the inverse
correlation as both assets are showing signs of possible future
appreciation. He added: Bitcoin $BTCUSD is waking up. Technicals
suggest rally is young. Key pattern is a rising channel from Sept
2020 which held at 29k. Likely path is 54-55k next, good pullback,
then 75k channel resistance. 29k *must* hold Bitcoin Rises As Gold
Experiences One Of Its Worst Periods To Date Arcane Research
recently published a report supporting the inverse correlation
between BTC and Gold. The precious metal has been “compounding
losses” already accumulated in previous days with a major sell-off
in the derivatives sector. Around 24,000 Gold futures contracts
were sold in a short span of time during the Asian trading session,
Arcane Research added. This constituted Gold’s “fastest and
second-biggest nominal drop ever”. The macro-economic outlook seems
to be contributing to the price action on both assets. Some
speculate that the soon-to-be-published report by the U.S. on
inflation, the measure by the Consumer Price Index (CPI), could
“encourage a reduction in stimulus by the FED”. The lower the
inflation expectations, the fewer investors feel the need to use
Bitcoin and Gold as a hedge. Senior Commodity Analyst for Bloomberg
Intelligence Mike McGlone claimed that Bitcoin and gold could face
a threat precisely from a macroeconomic event. In the meantime,
McGlone believes BTC and XAU could “advance together” as digital
and analog stores of value. The expert added: Resurfacing
deflationary forces indicated by declining U.S. Treasury bond
yields and peaking commodities add underpinnings to gold and
Bitcoin.
Compound (COIN:COMPUSD)
Historical Stock Chart
From Mar 2024 to Apr 2024
Compound (COIN:COMPUSD)
Historical Stock Chart
From Apr 2023 to Apr 2024