Is Gold Still A Safe Haven?
Between Christmas and New Years it really looked good for the metals. I thought we would be in full tilt rally mode the first of the year. With all what's happening in the USA in regards to politics or shall I say the "uncertainty" of politics, you would really think gold would be sky high way over that $2,000 price that so many were predicting. But not so. Last week it after a slight decline the price got smashed down $80 in one day and then proceeded to sell off even more. Since then it has rebounded and is holding well in the mid $1,800 range.
Except for these last few days of a rally, silver was not doing much better. Platinum and palladium also taking a hit. Platinum and palladium also taking a hit. Even copper and nickel rolled over this past week. Nickel's actually been on a real tear the last few months as seen in the chart below and stocks like Sherrit TSX-S let you know by hitting 52 week highs.
Lithium stocks however have put on a real shine this year. Stocks like Neo Lithium TSX-V: NLC and America Lithium TSX-V: LI have also been trending up well. Neo Lithium hit new all time highs this past week as well as Cypress Developments TSX-V: CYP hitting new highs. These stocks all have lithium properties in Nevada there is quite a bit of specualtion that maybe one of the companies will see a potential deal with someone like Tesla which wants to be able to produce batteries in Nevada. These lithium stocks will the ones to watch this year especially as the demand for lithium increases.
Getting back to gold and why it hasn't performed as well as expected, there is a lot of news out regarding a lot of private and public funds that held gold are now seeing that gold being sold and the money then going into Bitcoin. Bitcoin, the digital currency has gone from a low of $5,000 in March to over $40,000 this past week. Infact the price rallied $20,000 just this month of January alone setting a new all time high of $40,880.
This buying spree whether it be speculation or otherwise has created the demand rush for a fast return on equity in the markets. Others see Bitcoin as a new gold that is going to revolutionize the worlds financial markets on the way money is traded and handled. Being a global currency that is de-centralized, in other words, no country has control, some investors see Bitcoin as the ulitmate store of wealth because it is all digital and can be transferred anywhere in the world with a click on a laptop or smart phone. Whether this will happens still remains to be seen.
Of course there are still the gold bugs who under no circumstances will change their mindset on gold as being the safe haven, the hold it in your hand safe haven that has been around for thousands of years.
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