After Trump was shot and luckily was not seriously injured, in addition to promoting the recovery of the cryptocurrency market, the gold market also experienced alarming trends. Spot gold soared by nearly $47 yesterday, reaching a maximum of $2,469.76 per ounce, and continued its gains today. Earlier, it rose above $2,480 in the short term, reaching a maximum of $2,482.42, setting a new record high.
Gold, currently trading at $2,472.385, has surged nearly 20% this year on heavy central bank buying, strong consumer demand in China and rising risk aversion amid geopolitical tensions.
2 major reasons why gold has risen recently
After Trump was shot, gold performed brilliantly. One of the reasons was that the assassination attempt triggered political uncertainty, which boosted safe-haven demand for the precious metal. Yang Haiping, a researcher at the Securities and Futures Research Institute of China's Central University of Finance and Economics, said:
The sudden incident of Trump being shot at a campaign rally has brought uncertainty to the market, increased investors' risk aversion, and may increase allocations to safe-haven assets, which may be one of the driving factors for the rise in gold prices in the short term. .
In addition, signs of slowing U.S. inflation and a weakening labor market have also heightened market expectations that the Federal Reserve will cut interest rates soon. Since gold itself does not earn interest, interest rate cuts will reduce the opportunity cost of holding gold, thus making it more attractive to investors. Ewa Manthey, commodity strategist at ING Bank NV, said yesterday (16th):
Optimism about U.S. interest rate cuts is supporting gold as more economic data supports the case for the Fed to pivot. Gold is expected to maintain its positive momentum amid the current global geopolitical and macroeconomic conditions, while central bank demand is expected to grow.
Is Bitcoin the next new high?
Yang Haiping further pointed out that the shooting incident may improve Trump's chances of being elected, so from a medium-term perspective, the market may pre-plan for the direction of Trump's policy.
In this election, Trump clearly supported crypto assets and made relevant remarks many times, such as defending the right to mine Bitcoin and ending the Democratic Party’s suppression of cryptocurrencies. These stances have given Trump an increased chance of winning the election. , significantly boosting the prices of crypto markets such as Bitcoin.
Bitcoin exceeded $60,000 on the 14th and continued to rise. Although affected by yesterday's news that Mt. Gox transferred funds, it once collapsed back to $62,000. However, it continued to rise and once exceeded 6.6 earlier today. million, hitting a new high in a month, up 1.85% in the past 24 hours.
At the same time, the capital inflow of the U.S. Bitcoin spot ETF is also very impressive. The latest data shows that the net inflow is as high as 422 million US dollars, which has been net inflow for 8 consecutive days and reached a new high in one and a half months. This shows the strong interest of American investors in Bitcoin (pre-planning) as Trump’s probability of winning the election increases.
At the upcoming Bitcoin2024 conference on July 25, Trump will also attend a speech with a number of well-known figures who support Bitcoin, including independent presidential candidate Robert F. Kennedy Jr., Ark Invest CEO Cathie Wood Wood and Michael Saylor, the founder of MicroStrategy, etc. Let us wait and see what Trump will say again.
Extended reading: Support BTC even with gunshot wounds! Trump still plans to speak at Bitcoin 2024 conference, BTC breaks through $62,500
