Gold and Bitcoin Surge Following Trump’s Statement on Wealth and Power

Gold and Bitcoin surged after Trump’s quote highlighting wealth and power, with Gold reaching $3,384 and Bitcoin rising to $87,500. The gains correlate with increasing market uncertainty, attributed to US-China tensions and speculations about Fed leadership changes. Analysts note a shift in Bitcoin’s role, indicating a potential decoupling from traditional market trends as it rose alongside Gold despite a weakening dollar.

Gold and Bitcoin surged significantly following statements made by former President Trump, who emphasised the age-old link between wealth and power. He tweeted, “HE WHO HAS THE GOLD MAKES THE RULES,” which prompted a notable market response. Gold reached a record high of $3,384, advancing nearly 2% within a single day, while Bitcoin rose approximately 3% to $87,500, marking a 4.5% increase over the past week.

Analysts believe the concurrent rise of these two assets reflects increasing market uncertainty rather than just Trump’s comments. Geopolitical tension, particularly between the US and China, and broader economic instability are cited as underlying factors driving this surge. As The Kobeissi Letter noted, the simultaneous ascent of both Gold and Bitcoin indicates a potential downturn for the US dollar amid rising investor unease.

The US dollar index experienced a sharp decline, reaching a three-year low, influenced by remarks from National Economic Council Director Kevin Hassett regarding possible changes in Federal Reserve leadership. The potential for Trump to influence monetary policy has alarmed traders, leading them to sell off the dollar, which historically causes Bitcoin’s price to decrease. However, Bitcoin’s recent performance during this dollar drop has been atypical, suggesting a significant regulatory shift in its market dynamics.

Interestingly, while Bitcoin traditionally correlates with movements in the dollar, its recent rise during this dollar decline suggests an evolving perception of Bitcoin as a store of value, distinct from conventional market volatility. Despite the ongoing narrative of Bitcoin as “digital gold,” recent data indicate that Bitcoin’s correlation with gold is relatively weak, with a correlation coefficient rarely exceeding 0.3, while its relationship with technology stocks has been higher, reaching as much as 0.7.