Bloomberg Intelligence senior commodity strategist Mike McGlone makes important gold and Bitcoin predictions. Mike McGlone reports that technological innovations benefit many metals and suggests combining gold with Bitcoin in a portfolio.
Mike McGlone: Money benefited the US dollar and bitcoin as money moved away from gold
Bloomberg Intelligence senior commodity strategist Mike McGlone said that the digitalization of money so far has benefited the US dollar and Bitcoin while moving away from gold. Mike McGlone adds the following to his comments on the subject:
The metals industry has the greatest potential to continue to outperform most commodities as we’ve seen, especially in the long run. The accelerating trends in decarbonisation, electrification and digitalization are separating metals such as copper from crude oil replacing technology. But gold is being pulled down that rabbit hole. The digitalization of money increases the value of the dollar’s reserve currency and does the opposite to gold, which is being replaced by Bitcoin.
Mike McGlone: Without Bitcoin, the price of gold would be close to $ 2.300 …
Mike McGlone said gold would have been able to trade well above $ 2,000 per ONS had it not been for Bitcoin. Moreover, the analyst added that the popular cryptocurrency continues to limit the upward potential of the gold price. Mike McGlone adds the following to his comments on the subject:
The price of copper on April 28 is close to 9,800 dollars per ton… Gold, holding a fixed return, would be close to $ 2,300 per ONS instead of about $ 1,780 to match the 10-year relationship between the copper / gold ratio and bonds.
The strategist stated that the innovation is not as friendly to gold as it is for metals such as copper. Mike McGlone adds the following to his comments on the subject:
Gold has reached a point of change in their investment portfolios by Bitcoin. In a world that goes digital, there can be little to stop cryptocurrency accumulation at the expense of metal.
Mike McGlone: Yellow metal looks increasingly bare if not paired with Bitcoin
Mike McGlone’s solution is to pair gold with Bitcoin. Mike McGlone adds the following to his comments on the subject:
By the time 2021 is written, we hope that Bitcoin will be an accelerating process, replacing gold in investment portfolios. Metal seems increasingly bare if not paired with Bitcoin, and progressive digitalization will likely limit its price appraisal potential. There could be gold traded below $ 1,800 per ONS.
Mike McGlone: There could be gold traded for under $ 1,800 per ONS…
More specifically, Mike McGlone looks at the gold-Bitcoin 75/25 index. Mike McGlone adds that industrial metals must continue to outperform precious metals. However, the analyst warns that copper is at risk of a return in the second half of the year. Mike McGlone adds the following to his comments on the subject:
Annual measurements showing the benefits of various types of assets and low Bitcoin correlation for most assets show that our gold-Bitcoin 75/25 index has roughly the same risk as the stock market. From the beginning of 2018, when Bitcoin fell from $ 17,000, the gold-Bitcoin 75/25 Index rose by about 110%, almost twice the total return of the S&P 500 and more than 3 times that of spot gold. If the stock market continues to gain value, industrial metals should continue to perform better. But the biggest risk for commodities is that we see an increasing dependence on the rising tide of stocks.
Bloomberg analyst Mike McGlone’s successful predictions
Bloomberg analyst Mike McGlone stated and knew that Bitcoin will see $ 10,000 in early 2020. Mike McGlone gave the good news of $ 12,000 while the Bitcoin price was around $ 9,000 in recent months, and he knew that. Apart from these, the analyst has other successful insights. In early January, the analyst said BTC would see $ 50,000 in 2021, and this level was seen in mid-February.