The gold price reached a new record on Monday morning. That happened remarkably soon after the Bitcoin (BTC) course suddenly went down. It raises the question of whether investors are massively moving their profits from Crypto to safe ports such as gold. What does this capital shift run?
Gold price at record high after BTC decrease
Gold rose by one percent on Monday to a new high point of $ 3,727 per ounce (31.1 grams). The increase followed almost immediately at a sharp correction of Bitcoin, which lost 2.7 percent in 24 hours. Around 10:30 am, gold and crypto even started to move exactly opposite, making one of the greatest divergences visible in more than ten weeks.
The performance of gold does not lie. The precious metal this year is on a profit of 43 percent. That contrasts sharply with Bitcoin, which only achieved 17 percent return this year. And that is striking, because you can usually expect more from a risky investment like Bitcoin.
In addition, not only benefits gold from the volatility in the cryptomarket. Zilver also recorded a profit of one and a half percent on Monday and is approaching the highest level since 1975 by 44 dollars per ounce. The metal is already more than 50 percent higher this year.
The timing is therefore telling. The sharp decrease in Bitcoin and the simultaneous rise in gold suggest that investors redeem their profits from crypto and switch to the safer gold. Both assets count as forms of value storage, but in times of uncertainty, traditional precious metals still appear to enjoy more confidence.
Investors opt for certainty
The interest in precious metals has increased since the US central bank on 17 September reduced interest rates with 25 basic points. Remarkably, risky investments do not seem to benefit from that. Jnormally speaking, a lower interest rates stimulates risky assets such as crypto or shares, because borrowing becomes cheaper and investors are looking for higher efficiency.
Yet there are still obstacles lurking. More and more traders are showing restraint about the prospect of further interest rates this year. Moreover, there is great division within the Federal Reserve (FED) about the policy for the coming months.
Friday promises to be a decisive moment for Bitcoin and the wider cryptomarket. In the US, important inflation figures are then published, including the PCE Price Index, the favorite indicator of the central bank. This data can determine the pace of further interest rate letings. And for an interest -rate asset like Bitcoin, that can make the difference between recovery or new pressure on the course.
Source: https://newsbit.nl/goud-stijgt-terwijl-bitcoin-zakt-beleggers-vluchten-massaal-naar-veilige-haven/
