Gold vs Bitcoin vs DXY : Reputation of the 'Safe Haven' asset
Here I show you about the comparison between the Gold, Bitcoin and the DXY which is the US Dollar Index price. What seem so interesting based on this chart comparison is that the price of the Bitcoin is having a positive correlation toward the Gold's price in the last 3 months. On the other hand, the price of the DXY which is becoming the US Dollar index is having a negative correlation toward the Gold price.
US Dollar vs Gold
It's normal if we see the negative correlation between this 2 commodity index because the reputation of the gold which always be a safe haven asset and the DXY will represents the favor of the investors in USA market. If they see any good potential of the USA and the global market (as we know that the US Dollar is becoming the world's leading currency), people will accumulate the Dollar to invest in any type of work and business line which will increase the economic growth. Money inflow will occur during this condition and the price of the gold will have a reasonable decrease as an effect from money outflow which most of the investors sell their gold saving to open new business. And also the opposite, the money outflow from the US dollar will cause money inflow toward gold as the investors believe the gold's reputation as the safe haven.
Gold vs Bitcoin
The positive correlation however is totally different aspect between the gold and the DXY. The investors currently look at the bitcoin with the same perspective as they look in the gold, as the safe haven. People certainly believe that the price of the bitcoin could be the hedge comparing to the traditional currency. But, what makes it different with the gold is that the crypto adoption and blockchain technology which becomes an important part inside the industrial revolution 4.0 . The Bitcoin could be another safe haven asset, but of course becoming different with the gold as the traditional safe haven. I do believe that the bitcoin will have more future value comparing to the gold and cryptocurrency is here to stay.
US Dollar vs Gold
It's normal if we see the negative correlation between this 2 commodity index because the reputation of the gold which always be a safe haven asset and the DXY will represents the favor of the investors in USA market. If they see any good potential of the USA and the global market (as we know that the US Dollar is becoming the world's leading currency), people will accumulate the Dollar to invest in any type of work and business line which will increase the economic growth. Money inflow will occur during this condition and the price of the gold will have a reasonable decrease as an effect from money outflow which most of the investors sell their gold saving to open new business. And also the opposite, the money outflow from the US dollar will cause money inflow toward gold as the investors believe the gold's reputation as the safe haven.
Gold vs Bitcoin
The positive correlation however is totally different aspect between the gold and the DXY. The investors currently look at the bitcoin with the same perspective as they look in the gold, as the safe haven. People certainly believe that the price of the bitcoin could be the hedge comparing to the traditional currency. But, what makes it different with the gold is that the crypto adoption and blockchain technology which becomes an important part inside the industrial revolution 4.0 . The Bitcoin could be another safe haven asset, but of course becoming different with the gold as the traditional safe haven. I do believe that the bitcoin will have more future value comparing to the gold and cryptocurrency is here to stay.
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