Bitcoin, Gold and Geopolitics

Global markets are in turmoil as tensions escalate in the Middle East. Iran's retaliation to consulate killings sent shockwaves, pushing crude oil futures up 1% while BTC and ETH plummeted 6 and 5%. Gold, a traditional safe haven, reached its ATH at 2431 USD before pullback.

Crypto markets found hope over the weekend with Hong Kong's approval of BTC and ETH spot ETFs. But Monday brought fresh dips as geopolitical tensions intensified, testing the resilience of digital assets in the face of global uncertainty.

BTC Grappled with pressure amid Middle East turmoil, amplifying stock market volatility. Despite a rebound, declining trading volumes hint at bearish sentiment, even as BTC dominance hits a three-year high, surpassing 56%.

Iran's recent actions rattled markets, potentially impacting oil production and the crucial Strait of Hormuz. Despite initial spikes in crude prices, Brent crude fell below $90, indicating a cautious market sentiment amidst geopolitical tensions.

Traders view Iran's actions as targeted, not signalling broader conflict. Saudi Arabia and OPEC+ stand ready to cover oil shortfalls, mitigating fears of supply disruptions, and stabilizing global energy markets.

Amidst Middle East tensions, investors sought refuge in US Treasuries and gold, driving yields down. Despite Friday's volatility, Treasury yields remain poised for cycle highs, reflecting market jitters and flight to safety.

Gold saw modest gains, reaching all-time highs before retreating on USD strength. Geopolitical risks and inflation concerns fuelled volatility, with the metal hitting $2,431 before settling at $2,343, down 1.18%.

Iran's alleged plans for an attack on Israeli soil heighten geopolitical risks. Meanwhile, US inflation figures added to market unease, triggering fluctuations in precious metal prices, albeit short-lived.

A shift in the correlation between gold and Bitcoin emerges, with BTC increasingly aligning with the precious metal. March 2024 witnessed a reversal, marking a turning point in their relationship, now at a 0.86 correlation over the past year and 0.1 over the past month.

As global tensions persist, the interplay between geopolitics, traditional assets like gold, and emerging digital currencies like Bitcoin becomes ever more intricate, shaping the landscape of global markets. Stay tuned for further developments in this evolving narrative. #Bitcoin #Gold #Geopolitics

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