Gold lifted by silver bullets fireworks
Today, all the action is again on silver, which has advanced through USD20.00 an ounce, triggering stop-loss buying, jumping 2.0% to USD20.3150 an ounce. Liquidity is always an issue with silver, being on average much less than is available with gold on any given day. That partially explains why directional silver moves are usually much more aggressive and grander in scale than those with gold.
Having bottomed under USD12.0000 an ounce in March, silver has now risen by some 75.0%. Meantime, the XAU/XAG ratio collapsing from 128.00 to 89.634 today. That multi-month fall in the XAU/XAG ratio has likely provided a steady supply of sellers all the way up in gold, possibly slowing its advance. That was probably the case overnight as well, with the ratio falling by 2.55%.
However, gold has now advanced to USD1819.00 today, with silver’s rally inevitably dragging spot gold higher, despite the ratio selling. A move through USD1820.00 an ounce should see more stop-loss sellers, as well as model-driven buyers hit the market. That could lead to a reasonably rapid spike by gold into the mid-1830s an ounce, reinvigorating gold’s rally.
Bitcoin remains off the radar
Bitcoin has remained entrenched in a USD9000.00 to USD9500.00 range for over a month. The fall in volatility has led to a decline in participation by get-rich-quick FOMO traders, leading to a self-perpetuating negative feedback loop.
With precious metals marching higher, and signs that the V-shaped recovery trade is about to re-energize, Bitcoin looks poised to retest the bottom of its range, as its anarchist safe-haven appeal fades amongst the tin-foil hat, anti-5G brigade.
A failure of the USD9000.00 real fiat-currency support could see Bitcoin spike to the USD8350.00 zone, where both its 100 and 200-DMA’s are currently residing.