North Korea crisis draws out gold bulls while bitcoin breaks $4,000


As geopolitical tension between the US and North Korea enters its second week the price of gold remains buoyant. This morning gold was $1,281.61 with gold for December delivery at $1,292.4. However, commentators suggest a cross roads for the yellow metal as the impact of the geopolitical crisis that saw Pyongyang threaten the US Pacific territory of Guam continues to be debated by investors.

“What North Korea has done is given gold the legs to go above the $1,300 level and sustain above that level,” Chirag Sheth, an analyst at Metals Focus Ltd told Bloomberg, going on to say he could see gold surpass $1,400.

VTB Capital’s Evgeny Ananiev told the same source he believed gold could get to $1,360 within three months as political tensions continue, before rising higher, driven by demand from India and China. “We may see some correction, but I don’t think gold will drop below $1,200 as it’s well supported”.

That statement is supported somewhat by figures released by the Chinese Gold Association saying gold bar demand in China, the world’s biggest market, had risen by over 50% this year, as overall gold consumption went up 10%, reaching 545.2 tonnes. In India there are predictions that traders will import 25 tonnes of gold from South Korea over the coming months, exploiting a customs loophole.

However, some experts were more measured on the long term price for gold. “Maybe geopolitical tensions are easing so it’s natural for gold to come down a bit… But it’s very unpredictable because prices could rise to another high because of some change,” Richard Xu, a fund manager at China’s biggest gold exchange-traded fund, HuaAn Gold told Reuters. Xu went on to say that “after the sharp sell off in the dollar, over the weekend nothing happened so I guess the threat from the (Korean) peninsula is low, but we think gold fundamentals are strong.”

In other news bitcoin has broken new records for the second time this year, reaching $4,000. The cryptocurrency surged past $4,200 over the weekend giving it a market capitalisation of $67.98bn according to The Financial Times. However the price future remains uncertain as bitcoin data has been moved off the main network to further facilitate trading under a solution dubbed “SegWit2x”.

“With this actually being implemented on protocol, theoretically the amount of transactions that can be processed at a reasonable speed is going to be much higher, so a lot of people are very bullish about bitcoin now,” Arthur Hayes, founder of Hong Kong-based bitcoin exchange BitMEX, told Bloomberg.





Link to this article: : http://www.goldmadesimplenews.com/gold/north-korea-crisis-draws-out-gold-bulls-while-bitcoin-breaks-4000-13343/

Posted by on Aug 14 2017. Filed under Gold News. 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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