According to the authoritative FT, gold (XAU) is back on investors’ minds as more warnings of global economic distress pour in from the US.
To this effect, gold exchange traded funds (ETFs) saw a record month last month, adding $9.2 billion in new money to paper gold (buying the rights to gold rather than trading actual metal).
Gold is seen by many as a “safe-haven asset”, which some also consider Bitcoin to be. This is down to gold’s historical role as a backing for paper money (a role it no longer plays anywhere), and as a low-inflation asset that may hold its value better than collapsing fiat currencies.
There are many critics to this value proposition, including the famous Warren Buffett (also no fan of Bitcoin) who has said about gold that “It doesn’t do anything but sit there and look at you.”
Whatever the case, the gold chart certainly looks interesting these days.
Price is just now starting to tap the historic all time highs for gold, set years ago after the 2008 financial crisis.
However, here on the weekly chart we can see signs of fatigue on this uptrend that has been in play broadly since about September 2018. The RSI has set a trend of decline, signalling flagging strength as price rises.
In order for gold to continue to the highs and possibly break them, we would need to see a successful break of this weekly trendline. However, we may get this, as the histogram and MACD look to have bullish momentum on their side.
The views and opinions expressed here do not reflect those of CryptoGlobe.com and do not constitute financial advice. Always do your own research.
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