Gold investors are getting anxious, as the precious metal’s prices have slid a great deal since a number of vaccine companies have revealed medicines to combat the coronavirus. The price of one ounce of fine gold is valued at $1,770 per unit after the precious metal registered the third straight weekly loss in a row. Moreover, last week gold saw the largest weekly outflow ever, as investors seem to be selling the safe-haven asset in great numbers.
Gold (Au) prices per ounce continue to spiral lower in value, as the price of the precious metal is down more than 14.5% since the all-time high this past August. The reason for the low value during the last few weeks may be due to the progress stemming from vaccine manufacturers who claim to have produced medicines that will help battle Covid-19. Craig Erlam, an analyst from the forex exchange OANDA believes the most recent vaccine news is probably the driver.
“The news of vaccines has led to a lot of optimism in the market and we are seeing some outflows in safe-haven assets like the dollar, Treasuries and the same is being reflected in gold prices,” Erlam said in an interview on Monday.
Meanwhile, gold has also seen the largest weekly outflow ever, as analysts suspect that gold investors are cashing out. For instance, the independent financial researcher at The Gold Observer, Jan Nieuwenhuijs, shared a chart last week showing the massively sized gold outflows.
Alongside this, in an investor’s note on Monday, the chief analyst at Activtrades Carlo Alberto De Casa said “the short-term trend for bullion has been compromised by the price falling through the support level at $1,850.” The Activtrades chief analyst further added:
Investors have moved to other assets, seeking faster gains, although they haven’t forgotten that central banks will be forced to print money for many years to help the economy to recover from the Covid-19 crisis.
Of course, many investors and analysts see the precious metal’s money flow going into the cryptocurrency economy. Moreover, traditional market sentiment has improved a great deal and this has put a lot of eyes on bitcoin and digital asset investments. Simon Peters, an analyst at Etoro says that “sentiment is improving in traditional markets and the world.”
“All eyes have been on bitcoin in the past week with debates raging as to whether we reached a new all-time high or not,” Peters added. The Etoro analyst continued:
After the blistering run in the past eight weeks, a price correction was bound to occur and the fall this week is more than coincidence. With bitcoin having finally hit a three-year high on Tuesday – just days before Thanksgiving and the blockbuster sales of Black Friday it seems that many investors that have held since December 2017 have chosen to take their profits.
Furthermore, macro strategist Raoul Pal told his 282,000 Twitter followers that he planned to sell all of his gold reserves for cryptocurrencies. “I have a sell order tomorrow to sell all my gold and to scale it to buy BTC and ETH (80/20),” the macro strategist tweeted. I don’t own anything else (except some bond calls and some $’s). 98% of my liquid net worth,” Pal added.
The co-founder at Three Arrows Capital, Kyle Davies, also discussed money from gold flowing into the crypto economy this week.
While crypto-assets like bitcoin are on a tear and gold prices are seeing weekly lows week after week, per usual, gold bug Peter Schiff has felt the need to attack bitcoin on Twitter. Schiff is not too pleased with the fact that a number of CNBC news anchors like Brian Kelly are bullish about bitcoin’s future value.
“The reason it’s so easy for bitcoin pumpers to fool CNBC anchors into buying into the bitcoin mania is that their understanding of investments, fiat money, gold, and economics is so limited,” Schiff tweeted on Monday. “CNBC anchors are entertainers. At least sports anchors know something about sports,” he added. Meanwhile, on the exchange Bitstamp, bitcoin (BTC) touched an all-time high of $19,864 on Monday, November 30, 2020.
What do you think about the massively large gold outflows last week and the price spiraling lower? Do you think gold investors are joining the crypto economy? Let us know what you think about this subject in the comments section below.
The post Gold Sees Largest Weekly Outflow Ever, Metal Prices Spiral Lower, Analysts Expect Flows Into Bitcoin appeared first on Bitcoin News.