Gold and Silver Reach New Highs, But How will this Affect Bitcoin?
Record Highs in Gold and SilverGold and silver have moved to new record highs in reaction to expectations of rate cuts, safe havens, and the weakening U.S. dollar. Currently, gold is up by 67% and silver by 138% so far this year.
Reaction from the Crypto MarketThe reaction from the crypto market has not followed the trend, as Bitcoin has generally been ranging between 86,000 and 89,000. It has historically taken a few weeks for the crypto market to follow the upswing in the value of Gold.
What to ExpectIf rate cuts and liquidity measures persist, crypto might follow metals higher once risk appetite returns. From past cycles, Bitcoin has typically responded with an increase of around 180% in the following six months, with an average lag of 15 weeks.
Present Market TrendsBitcoin was affected by weakness in the equity market and the relatively risk-averse market, while gold and silver moved higher in response to concerns about recession and geopolitical issues. So long as economic troubles persist, cryptocurrencies look to remain under pressure. Alternatively, if the equity market normalizes and interest rate cuts take hold, the outlook for Bitcoin could improve.
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