Gold price has begun the week in green as investors ponder on Bitcoin’s volatility. In the recent past, cryptocurrencies have gained popularity as an alternative hedge against inflation. Unlike precious metals and the US dollar, cryptos are not subject to interference by the government or any other centralized organization. With Bitcoin being the leader of the pack, high demand pushed its price to an all-time high of 65097 in April this year.
Despite this advantage, its recent price movements have poked holes into its reliability as a hedge against inflation. Over the past two weeks, BTC/USD has dropped by around 40.69%. The decline resulted from the inflation jitters that rocked stocks, crypto, and commodity markets. On the other hand, the appeal for precious metals as a hedge against inflation surged. Subsequently, gold price has been on an uptrend, having hit its three-month high in the past week.
Price Technical Outlook
Gold price is up by 0.3% at 1,886.81. On a two-hour chart, the precious metal is trading above the 25 and 50-day exponential moving averages. Besides, it is above the ascending trendline highlighted in black; which further substantiates the bullish outlook.
I expect gold price to retest the three-month high hit last week at 1,890. If the bulls gather enough momentum to push past that resistance level, the next target will be at the psychological level of 1,900. On the flip side, it may drop to around 1,880, where it will find support along the trendline.