Lightning crash shakes gold markets as Bitcoin holds firm
Gold prices fell during Monday morning’s Asian trading session, compounding losses accumulated over the past week.
On August 9, the price of gold quickly fell to its lowest level since March as a flash crash brought prices below $ 1,700 / oz.
According to Tradingview, the price of the precious yellow metal plunged to $ 1,690 / oz during Asian trading hours on Monday. The price of gold has since rallied slightly, last changing hands at $ 1,742 / oz at the time of writing.
Gold is currently down 4% over the past 7 weeks and 8.7% since trading above $ 1,900 / oz in late May. The precious metal has fallen 8% for 2021 so far, and is currently down 14.6% from its all-time high in August 2020 just below $ 2,040.
How the hell did I sleep for that golden flash crash pic.twitter.com/2Foy7WiOwB
– President Everything-Will-Pump ™ ️ (@ chairmanlmao33) August 9, 2021
Forex trader and charts guru Peter Brandt attributed the crash wholesale liquidations, declaring: “This has all the fingerprints of a bank / brokerage doing a forced liquidation on a huge leveraged speculator. “
He noted that the leverage ratio in the Chicago Mercantile Exchange gold markets is around 15 to 1, suggesting that heavily leveraged traders are boosting gold price action.
Analysts at the London-based City Index trading company likewise blame the crash this morning to “stop-loss tied selling in very tight market conditions”.
However, unemployment figures in the United States were also the catalyst for lower commodity prices last week. Unemployment rate fell more than expected to 5.4% from 5.9%, a new pandemic-era low according to a Bureau of Labor Statistics report published Friday. As the job market and economy grow larger, the US economy continues to recover, City Index concluded:
“The best jobs data has pushed up the yields of the US dollar and US bonds, which is never a good formula for commodities.”
With BTC currently worth 25 ounces of gold, Bitcoin is down 28.5% from its all-time high against gold – with a single BTC worth 35 ounces of gold during Bitcoin’s record high price of nearly $ 65,000 in mid-April. However, a Bitcoin was worth 15.5 ounces of gold at the start of 2021.
At the time of writing, BTC had fallen 2% in the past 24 hours to trade for $ 43,667, according to CoinGecko.