Flash crash shook the gold market as Bitcoin remained strong

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This morning, the cost of gold has fallen below $1,700 per ounce, and analysts describe it as a stop-loss-driven transaction.

The price of gold fell during the Asian morning trading hours on Monday, plus the accumulated losses over the past week.

On August 9, the price of gold fell below $1,700 per ounce due to a flash crash, and the value of gold quickly fell to its lowest level since March.

According to Tradingview, throughout the Asian trading session on Monday, the price of precious yellow metals plummeted to $1,690 per ounce. Since then, the price of gold announced a slight rebound, with the last lot of US$1,742 per ounce at the time of writing.

Gold is currently down 4% in the past seven weeks, and mercantilism is down 8.7% above $1,900 per ounce. So far, precious metals have fallen by 8% in 2021, and are currently down 14.6% from the unparalleled high of $2,040 in August 2020.

Peter Brandt, a foreign exchange dealer and chart guru, attributed the crash to wholesale liquidation and said: “This has all the fingerprints of banks/brokers’ compulsory liquidation of hugely leveraged speculators.”

He pointed out that the amount of leverage in the Chicago Mercantile Exchange gold market is about 15 to 1, which shows that high leverage is driving the value of gold.

Analysts at the City Index, a mercantilist company in London, also attributed this morning’s crash to “stop-loss related businesses under extremely weak market conditions.”

However, the data from the US states also acted as a catalyst for the decline in the cost of traded goods last week. According to the Bureau of Labor Statistics report released on Friday, the unemployment rate is expected to fall from 5.9% to 5.4%, which is an alternative low point during the pandemic. As the market and economy continue to recover in the wider U.S. economy, the Towns Index concludes:

“Higher employment data pushes dollar and U.S. bond yields higher, which has never been a good formula for commodities.”

One BTC is currently worth 25 ounces of gold, and Bitcoin has fallen by 28.5% from its unparalleled high against gold-during the entire period of Bitcoin’s unparalleled value of nearly $65,000, one BTC is worth 35 ounces of gold. However, at the beginning of 2021, one Bitcoin is worth 15.5 ounces of gold.

At the time of writing, BTC has fallen 2% in the past 24 hours and traded at $43,667, which is consistent with CoinGecko.