Gold hovers around $1800 mark in early trading
Though stuck on pause, it is still up 7% from March double bottom

(USAGOLD – 7/23/2021) – Gold hovered around the $1800 mark in early trading as bond yields firmed and the dollar held steady. It is down $6 at $1802. Silver is down 18¢ at $25.30. Though the yellow metal seems stuck on pause in the summer of 2021, it has still managed a respectable gain since logging a double bottom in late March at $1680 and inflation emerged as a major concern in financial markets. It is up 7% since March 30th.* On the other hand, bitcoin, an asset widely touted as gold’s safe-haven competitor, has roughly halved – a development not lost on Sharp Pixley’s Lawrie Williams. (Please see our Charts of the Day below.)

“Gold meanwhile seems to have so far been doing its job of wealth protection in the face of falling values for other asset classes,” he writes in an analysis posted earlier this week, “These include, most notably, bitcoin, which had been heavily touted as a wealth protection alternative to gold, but has been slipping sharply in value over the past couple of months. It would appear to have no substance behind it and some key players in the sector are being beset with some highly adverse publicity and the beginnings of regulatory controls, which don’t bode well for its future. Gold looks to be very much the safer bet for now at least, particularly all the while rising inflation has pushed the real interest rate ever further into negative territory. Negative real rates are very much seen as a positive for gold.”

*Stocks are up 5.2% over the same period.

Charts of the Day

(Six months)

line chart showing bitcoin's performance over the past six months

(Six months)

line chart showing gold's performance since logging double bottom in March

Charts courtesy of • • • Click to enlarge

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