Has Bitcoin Battered Gold?

Gold crumples again overnight as Bitcoin futures start trading, setting the scene for lower levels.

I suspect it is no coincidence that the day that Bitcoin futures officially started trading, gold prices dropped in an otherwise sideways overnight session in most markets. The Commitment of Traders Report showed a substantial drop in speculative long positioning which should be no surprise once 1260.00 broke as spoken about ad nauseam in this column. There has been much talk of a rotation out of gold and into bitcoin (but no concrete evidence), and where there is smoke, there is fire. Even if that fire ends up being the “rotating” money eventually being burnt to ash.

Gold fell from 1247.80 to close at 1242.00 overnight, rallying and failing at resistance along the way. This morning it has eked out a small rally to 1244.50 on physical buying and profit taking, but the price action remains unconvincing.

Gold has resistance at 1252.50 which held yesterday’s recovery attempt. It is followed by the break-out at 1260.00. Support is at the overnight low at 1240.70 with the charts again opening up a chasm to the 1205.00 regions after that.

Gold Daily

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Jeffrey Halley

Jeffrey Halley

Senior Market Analyst, Asia Pacific, from 2016 to August 2022
With more than 30 years of FX experience – from spot/margin trading and NDFs through to currency options and futures – Jeffrey Halley was OANDA’s Senior Market Analyst for Asia Pacific, responsible for providing timely and relevant macro analysis covering a wide range of asset classes.

He has previously worked with leading institutions such as Saxo Capital Markets, DynexCorp Currency Portfolio Management, IG, IFX, Fimat Internationale Banque, HSBC and Barclays.

A highly sought-after analyst, Jeffrey has appeared on a wide range of global news channels including Bloomberg, BBC, Reuters, CNBC, MSN, Sky TV and Channel News Asia as well as in leading print publications such as The New York Times and The Wall Street Journal, among others.

He was born in New Zealand and holds an MBA from the Cass Business School.
Jeffrey Halley
Jeffrey Halley

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