As an analyst with over two decades of experience in global markets, I have seen my fair share of bull and bear cycles, but none quite like what we are witnessing now. The current environment of unprecedented liquidity is driving gold, the S&P 500, and Bitcoin to new heights, with each asset class outperforming the other in its unique way.
In my analysis, as global liquidity keeps climbing, it seems we’re heading towards another robust year for gold and the S&P 500, with these assets spearheading the charge across various asset classes. Notably, Bitcoin, which has a strong correlation to global liquidity, is expected to follow suit and outperform all other assets in this kind of economic environment.
Gold is seen as real money once again
For a significant portion of history, gold has served as a protective asset during challenging financial times. When governments and their central banks overspend, gold has historically been a reliable haven for preserving wealth. However, since the 1970s, banks have skillfully manipulated the price of gold, leading some to think that the dollar was supreme and gold was an outdated currency without value.
Since then, a vast amount of U.S. dollars, measured in trillions, have been printed and introduced into circulation due to the widespread practice of debasement. This influx of paper currency over the years has led to gold regaining its reputation as genuine money. Consequently, governments and private investors are purchasing gold again.
As a crypto investor, I’m finding myself drawn towards gold right now. The chart suggests that gold prices are on an upward trajectory, having broken through its ascending trend line. This move appears to be parabolic, which is quite intriguing. With gold currently in the process of price discovery, the next significant target seems to be the 2.618 Fibonacci level at around $3,340. I can’t help but ponder about how much less buying power the dollar will have when gold reaches that point.
S&P 500 ultra-bullish if it breaks up out of ascending channel
The S&P 500, unlike gold, presents a distinctly unique picture in terms of growth, exhibiting equally robust upward momentum. However, it’s important to note that there is some criticism surrounding the S&P 500, as its strength primarily derives from the seven leading US companies, which are often referred to as “the magnificent seven.
Despite a previous trend, the stock market has been consistently climbing since October 2022. It’s even showing signs of breaking free from its upward trajectory, which if successful, would indicate a very optimistic outlook. The potential peak for the S&P 500 could reach approximately $6,970, representing a significant Fibonacci level.
$BTC lagging – but this could change soon
In simpler terms, Bitcoin hasn’t really taken off as much as stocks like gold or the S&P 500 yet. But right now, its price is trying to change that situation. If it manages to break free from its current pattern (bull flag) and confirm this movement, Bitcoin could potentially outshine all other assets, including gold and the S&P 500.
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2024-10-17 13:08