Gold outperformed bitcoin this month after crypto markets were shaken by the recent FTX crash, with the precious yellow metal up 6.12% since November 1st. The US housing market has shown weakness and the US inflation rate for October was lower than expected. Analysts believe these economic trends contributed to the price of gold rising 3.81% against the dollar on November 10, 2022, after the US Bureau of Labor Statistics released the Consumer Price Index. (CPI) for October.
So far, the gold market performance in November has outperformed that of Bitcoin
Bitcoin has seen better days, as the leading crypto asset is down more than 18% less than during the first of November. A large part of the USD losses from crypto assets may contribute to the FTX crash and the chaotic fallout that followed.
An ounce of gold, on the other hand, is up 6.12% above what was trading on November 1, 2022. On that day, the spot value of a troy ounce of 0.999 fine gold was 1.647, US$50 nominal. Today, the value of one ounce of .999 fine gold is approximately $1,748.49 per unit.
Analysts, gold fans and economists attribute some of gold’s success over the past two weeks to declining US real estate sales. The National Association of Realtors (NAR) reported Friday that “the Existing home sales fell 5.9% in October.
“Existing home sales faded for the ninth straight month at a seasonally adjusted annual rate of 4.43 million. Sales fell 5.9% since September and 28.4% from a year ago”, details the NAR report. The NAR study also attributes the fall in home prices to the Fed’s aggressive rate hikes that have raised the interest rate on 30-year loans sharply this year.
The bulk of gold’s rise began on November 1, 2022 and jumped further after the US Bureau of Labor Statistics released the Consumer Price Index (CPI) for October. The lower inflation rate pushed the gold price up 3.81% against the US dollar between November 10 and 13, 2022.
The report also helped bitcoin (BTC) to some extent, as the effect of the FTX crash on crypto markets could have been worse if the inflation rate was higher. The BTC hourly candle after the CPI report was released jumped much higher.
On November 10, the price of gold per ounce was rising to $1,706 per unit and by November 13, 2022, it was trading at $1,771 per ounce. Frank Cholly, the senior market strategist at RJO Futures, told Kitco News that gold may have risen too fast and the precious metal is simply taking a breather.
“Gold approached $1,800. And now the market is seeing profit taking. It looks like it’s turning around. I’m not ready to be bearish yet. We’re taking a breather,” Cholly explained Friday. However, there is a point at which Cholly could turn bearish as RJO Futures Senior Market Strategist commented:
If gold closes below $1750 I would start to go bearish – at $1725 things turn ugly for gold.
Just as bitcoin advocates are betting on the Bitcoin halving event to boost BTC prices, gold fans think that the price of gold will be much higher in the next eight years. Traders at primexbt.com believe gold will reach $4,721 per ounce by 2024 and by 2030 traders predict gold will reach $8,732 per ounce.
What do you think about the performance of the gold market so far this month? Let us know what you think about this topic in the comments section below.
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