18:35Bitcoin may sustain $10K as gold nears ‘inflection point’ vs. stocks
Gold and Bitcoin as safe havens may be about to outperform stocks, a Bloomberg strategist says.
Huge gains in stock markets despite the dire economic consequences of coronavirus may soon be a thing of the past, one analyst warns.
In a tweet on Sep. 4, Mike McGlone, senior commodity strategist at Bloomberg Intelligence, said that gold may soon get the limelight as markets reach an “inflection point.”
Strategist: fiat markets may soon face day of reckoning
“In a battle of the bulls, we see greater potential endurance favoring #gold over the #Nasdaq,” he wrote.
McGlone was referring to the major market phenomenon of the past six months — equities keep going up, even reaching new highs, while central bank interventions in the economy reach unprecedented levels.
Previously, analysts even postulated that stock markets’ value no longer matters due to the extent of manipulation since March.
Gold and Bitcoin (BTC) have both profited from fiat uncertainty since July.
Nasdaq vs. gold, central bank balance sheet chart. Source: Bloomberg/ Twitter
Bitcoin and gold contrast fresh dollar pressure
Another curious counterpoint comes in the form of the U.S. dollar currency index (DXY), which recently plumbed two-year lows. For gold bug Peter Schiff, the outlook for the precious metal is likewise favorable thanks to geopolitical shifts as a result of this USD weakness.
Discussing news that China plans to reduce its dollar exposure, Schiff said that, as before, average Americans would end up footing the bill.
“If true this is very significant,” he tweeted.
Schiff added that during this week’s retracement, gold won out over Bitcoin, which saw sharper losses. New strength in DXY, however, may yet spell trouble for optimism over both assets.
Bitcoin vs. gold realized correlation 6-month chart. Source: Skew
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