Ark Invest CEO Cathie Wood says gold is headed lower and bitcoin will keep gaining on it. Gold rose 1.7% on Nov. 9 while bitcoin slipped below $75,000, and Tuesday's CPI report is the next test.
Cathie Wood said on Nov. 9 that bitcoin's correlation with gold has been just 0.1 since 2019. Her conclusion is that gold is going down. Wood also believes bitcoin will keep gaining on gold because it "marches to its own beat."
Gold rises as the call is tested
The short-term data works against Wood. Gold rose about 1.7% to settle at $4,141.14 an ounce on Nov. 9, while oil prices slid and the dollar weakened.
Bitcoin, meanwhile, briefly dropped to $73,700 as more than $1 billion in leveraged positions were liquidated. Peter Schiff, a longtime gold advocate, said since the midterms bitcoin is down more than 4%, while gold is up more than 5% and silver is up almost 7%.
A repeat of her September view
Wood has taken this position before. In September, she told viewers of Ark's "In The Know" series that bitcoin had far to go against gold. At the time, bitcoin traded near $78,008 and spot gold sat near $4,377 an ounce.
Since then, the ratio has barely budged. With bitcoin at about $74,700 and gold at about $4,141, one bitcoin buys about 18.1 ounces of gold, compared with roughly 17.8 ounces in mid-September.
Gold's rough year
Wood is betting against a metal that has already taken damage. Gold hit a record of $5,110.50 on Jan. 26 and then fell to about $3,986 on Oct. 23, a drop of roughly 22%, Bitcoin.com News reported.
The next catalyst is Tuesday's U.S. consumer price index (CPI) report. Traders are already pricing a likely December hike from the Federal Reserve, and higher interest rates can weigh on both gold and bitcoin because neither pays a yield.
Source: Bitcoin News
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