Analyst Sees Gold at $4K in 2020; What Does It Mean for Bitcoin?

Analyst Sees Gold at $4K in 2020; What Does It Mean for Bitcoin?


But the metal lately served as a leading indicator to the cryptocurrency. A rise/plunge in XAU/USD typically followed a similar price action in BTC/USD. It showed Bitcoin traders’ inclination to tail gold, for the metal serves as a barometer to measure investors’ risk-off sentiment.

Gold Boom Ahead

The macro strategist mentioned weddings in India that typically peak after October every year, thus raising bids for gold-made ornaments and jewelry. Moreover, the Hindu festival of Diwali keeps the demand up throughout October and November. The sentiments pick momentum also during the Christmas and the Chinese New Year.

If Mr. Holmes is right about his ,000-price target for gold, then it may then also see Bitcoin pursuing an upside trend. That would mean a breakout above ,500, a level the cryptocurrency has failed to break bullish throughout 2020.
Frank Holmes, CEO of US Global Investors, told Kitco News that the gold market is forming a bottom. Simultaneously, the analyst maintained his upside target for the precious metal at ,000 in 2020 despite the fears of uncertainty around November’s US election and the second coronavirus stimulus package.

Gold has slipped 8.88% from its all-time high. Source:

An optimistic forecast for gold is making Bitcoin equally bullish, thanks to its erratically positive correlation with the crypto.

“The bottom that you’re seeing in gold is like a perfect Miami beach bottom,” Mr. Holmes said.

“Gold will go up and it will go down, the DNA of volatility you can measure over 20 trading days, 60 trading days, 12 months, it was up when we talked about time for a correction in at the beginning of August three standard deviations over 20 trading days. It’s now down one standard deviation.”

US Presidential Election

“It’s an auspicious time for the consumption of gold, and it’s most highly correlated with GDP per capita growth,” Mr. Holmes stated.
The statement came as gold continues its attempts to reclaim its all-time high above ,000 amid high profit-taking and a renewed bids for the anti-risk US dollar. But Mr. Holmes expected the demand for the precious metal to go higher in a string of festival seasons across the world.
Mr. Trump suspected “voter fraud,” leaving investors grappling with the prospects of higher market volatility around the election. As a result, some of them moved into the safety of cash, causing riskier assets to decline. Bitcoin and gold plunged almost in tandem as a result.

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Gold, Bitcoin, and stock markets reacted negatively to President Trump’s tweet wherein he threatened to reject the election outcome should his Democratic rival Joe Biden win.

Bitcoin lags gold moves. Source: is author of this content, is is not responsible for the content of external sites.

The expected demand for physical gold and its potential effect on its futures stock offset risks posed by the US presidential election.

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