Last Friday’s NFP was disappointing. The reaction of the markets was astonishing. Will it last longer? Let's find out the main trade opportunities for the upcoming week.
Bitcoin bulls buy gold
2021-02-11 • Updated
Bitcoin skyrocketed to a record high this week after Tesla announced it had made a $1.5 billion investment in the cryptocurrency. Cryptos are becoming more popular not only among traders, but also large corporations start showing their interest. By the way, Mastercard has uncovered its plans to let payments in crypto already this year. Apple claimed it would launch its own crypto exchange.
While some analysts believe gold will be soon replaced by crypto. We should admit that cryptocurrencies are highly volatile. Therefore, investors see gold as a way to hedge against this volatility due to its stability.
“If you’re into cryptos, you want to consider having some gold. Bullion “may act as a bit of a hedge against the volatility of cryptos,” said Newcrest Mining.
According to Goldman Sachs, gold and bitcoin can exist together. Even if crypto bites off some demand from the yellow metal, the precious metal will remain sought-after.
Gold has been trading in a descending channel since mid-summer. This week it has gained due to the weak US dollar, but the upside is limited by the 200-day moving average of $1 850. If the price drops below the low of January 15 at $1 825, the doors towards the one-week low of $1 790 will be open. On the flip side, the breakout above $1 850 will push the price up to the 100-day MA at $1 870.
Unlike gold, BTC is up more than 50% in 2021. If it jumps above $47 000, the way up to the next round number of $50 000 will be clear. Support levels are at the recent lows of $39 000 and 37 000$.
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Weaker recoveries were seen in both the UK manufacturing and service sectors, with the latter recording the greatest loss of momentum since July.
After an extremely volatile week in the markets, traders await the next steps of the USD and stocks. What drivers will move the assets next week? Lets’ find out!
Let's dive into the latest developments shaping the global economic landscape. Good news first: the threat of an unprecedented US debt crisis has receded, as US lawmakers passed a bill to raise the debt ceiling and avoid a catastrophic default. Phew! But don't pop the champagne just yet, because storm clouds are still looming. High inflation, rising interest rates, and sluggish growth are challenges that have yet to disappear.
Thanks to the incredible advancements in horizontal drilling and fracking technology, the United States has experienced a mind-blowing shale revolution. They've become the heavyweight champion of crude oil production, leaving Saudi Arabia and Russia in the dust. They even turned the tables and became net exporters of refined petroleum products in 2011.
Let's dive into the world of gold. Currently, the price of gold, represented by XAUUSD, is stuck in indecision, hovering around the $1,975 mark. The market is anxiously awaiting two important factors: the release of the Federal Reserve's meeting minutes and the extension of the US debt ceiling.