Gold prices have been climbing, with the ongoing Russia-Ukraine conflict, lending proof once again that the safe haven narrative might be correct. The war between Russia and Ukraine has been going on for 12 days, and despite the talks, the fighting continues. Gold, a traditional safe haven, has risen in price, reaching $2,000 for the first time in months as a result of the instability. Bitcoin (BTC) on the other hand, is on a downtrend.
Gold is currently trading just below $2,000, however, it recently peaked at roughly $2001.06, some hours ago. The last time it traded at this level was in August of 2020.
While gold prices are skyrocketing, risky assets aren’t faring so well. Bitcoin (BTC) has lost roughly 13.5 % in the last six days, and at the time of publication is trading at around $38,163. In other words, we’ve returned to where the cryptocurrency was trading before the war’s jump, and it’ll be interesting to see how prices develop at this rate.
Are people moving from Bitcoin to gold?
Gold being the former safe haven for investments, seems to be making a comeback, which was previously Bitcoin’s position. The stock market is likewise having a tough time. The DOW futures are down 1% in pre-market hours on Monday, as are the S&P 500 and the Nasdaq.
Bloomberg’s chief commodity strategist, Mike McGlone, has resorted to Twitter to predict that Bitcoin (BTC) will drop down to $30,000 once more.
According to McGlone’s chart, Bitcoin and Nasdaq 100 futures are currently moving in the same direction and are both declining. He appears to be implying that Bitcoin and the stock market are once again correlated.
The leading digital currency has been steadily declining since Tuesday, March 1st. However, on March 3rd, it plummeted, and from that day until this morning, BTC has lost 10.24% of its market value, falling from $44,031 to $39,522.
With gold prices on the rise, people could have had a change of heart, and switched to the age-old asset. With Russian investors being left out from many platforms, it could be possible that they are diving into gold in order to save their investments, as the Russian Ruble has crashed significantly.
On Monday, oil prices, too, rose about 10% in international markets as the threat of a US and European ban on Russian products, as well as delays in Iranian talks, produced a massive stagflationary shock for global markets.