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Gold drops as Stocks Reach 3-month high
The price of gold dropped by $24 on Tuesday, as the global stock markets hit their highest levels since March. Usually the flight is “to” the safe haven, however today, traders flew “from” the metal in favour of equities positions instead.
The highs come as markets continue to discount the risks’ associated with arguably the worst civil unrest in the United States in decades. The tech-heavy Nasdaq currently sits only 3% below its pre-pandemic all-time high. Japan’s Nikkei was up 1.2% and the FTSE 100 up 1% showing strength in global stock markets led by the DAX’s 3.75% gain as automotive shares surged in Germany.
Sterling Rallies as Brexit Flexibility Grows
After yesterday’s moves, Cable continued to climb above $1.25, seeing the pair reach its highest point since April 4th. This comes as reports suggest that the UK might be willing to compromise on previous sticking points in Brexit negotiations with the European Union.
Brexit which has fallen down the pecking order of priorities for both the UK and EU due to COVID-19, still seems to create volatility for traders, when updates are announced.
Bitcoin Briefly Above $10,000
Do you recall in March, when BTCUSD dropped by 50% in only 2 days of trading? That low saw Bitcoin trading at $3,750, where do you think it is now?
Today Bitcoin continued its recent rally by finally crossing the $10,000 mark, well for a 6 hour period at least. Similar to Gold which sold off as stocks continued to outperform expectations. Digital gold was also a casualty of equity bulls, who likely rotated out of their crypto positions into stocks.
Biggest Bull
Crude Oil: The news that OPEC and Russia are considering further talks to discuss production cuts continues to boost Oil prices. Crude was up over 3% on Tuesday.
Biggest Bear
Gold: Gold dropped from quoting $,1745, to a low of $1,721 all in the space of several hours. $1,745 which has long been a resistance level, saw bears once again prevent a break out.
“You never know what kind of setup the market will present to you, your objective should be to find an opportunity where the risk reward ratio is best.”
Jaymin Shah
