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Gold primes for another rally as bitcoin traders anticipate split

The gold price has edged up against a soft dollar and wavering sentiment over a US interest rate hike. The greenback almost touched a ten-month low after weaker economic data reduced the likelihood of an early rate hike from the Federal Reserve. The gold price currently stands at $1,229.72.

Last Friday the US government reported stagnant consumer prices and declining retail sales for two months in a row. Traders cut back their bets on the chance of a rate hike in December; consensus was that the next hike will take place then.

ANZ analyst Daniel Hynes was quoted in Reuters as saying “gold is now primed for another rally. Investor sentiment has improved quite dramatically over the past week, especially with the weak data out of the United States last week”.

Bitcoin has experienced a strong negative price swing to below the $2,000 mark. The cryptocurrency reached a low of $1,830 yesterday, having broken through to highs of $3,000 last month. Despite volatile price swings being common, this particular movement comes in anticipation of a “soft fork” on August 1st.

A “soft fork” refers to a split between the blockchain community in how to scale the Bitcoin network to accommodate an ever increasing number of transactions. The network is currently struggling to deal with demand, resulting in high fees and processing times.

If more than half of bitcoin miners do not support the move, it risks turning into a “hard fork”, where bitcoin essentially splits into two separate coins running on distinct networks.

Investors are cautious that their holdings may become worthless, as bitcoin would essentially “reset itself” as it integrates into a payments system and accrues a larger user base.

Photo: skodonnell via istock.

Link to this article: : http://www.goldmadesimplenews.com/gold/gold-primes-for-another-rally-as-bitcoin-traders-anticipate-split-13278/

Posted by on Jul 17 2017. Filed under Gold News, Markets. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.

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