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Fed Meeting to Spur Volatility for Gold and Bitcoin

Published 03/22/2023, 02:52 PM
Updated 07/09/2023, 06:31 PM
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Gold

Today will see further volatility in gold. The price activity over the last two days has been poor, but remember that the price is already flirting with its all-time high. As a result, it is very logical for traders to take some profit following such a spectacular gain.

Everything relies on how the Fed plays its monetary cards. A hawkish position by them is expected to strengthen the dollar index, which might spark a sell-off as the dollar index gains traction. But, after the first jerk response, the gold price may rise since traders do not want to hear the Fed being aggressive with its monetary policies. This is because it introduces more danger into the system, which everyone attempts to avoid.

A dovish Fed might boost gold prices if the dollar index continues to suffer. Overall, given the momentum in gold prices, the path of least resistance is more skewed to the upside than to the downside.

Bitcoin

Due to the US and European banking troubles, the ancient crypto king has received much attention this month. It has reclaimed its status as a safe haven asset while simultaneously demonstrating the very essence of its existence: controlled money via centralized monetary policy is a formula for catastrophe in the contemporary day.

Banks invent them out of thin air and rely on them to restore trust. This aspect, confidence, has become a scarce commodity, and traders and investors doubt every legislative action. Technically, the price is still hesitant to test the 30K price level, but if this level is broken, we are likely to enter a true bullish phase, and talk will begin that the bottom has been reached, Bitcoin's price has doubled in a matter of minutes, and it is time for FOMO.

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