Precious Metals Rebound Toward Monthly Highs Amid Crypto and Equity Market Movements

Gold prices surged by over 1% in a single day and have seen an impressive 8% increase since mid-February. This upward trend comes as a response to the cooling of both cryptocurrency and equity markets.

Today, gold approached the $5,250 mark, marking a significant climb towards a seventh consecutive monthly gain. It is worth noting that in late January, gold hit an all-time high of nearly $5,600 due to escalating geopolitical tensions between the US and Iran. These tensions were fueled by Iran’s protest crackdown, US intervention threats, and military buildup, prompting a surge in safe-haven demand.

Although there was a sharp pullback in metals at the beginning of February after the peak in January, both gold and silver have since rebounded. Gold saw a decline of more than 21% from its high to around $4,400, while silver dropped by nearly 46% from $121 to $64. However, silver has now risen by over 6% in a day, reaching around $94 and setting a new monthly high with a remarkable 28% increase since mid-February.

Additionally, spot platinum experienced a 3.5% gain, reaching $2,352 per ounce, while palladium slightly edged up by 0.1% to $1,785. Both metals are showing positive trends towards monthly advances.

Contrasting Trends in Metals, Cryptocurrency, and Equities

While precious metals are on an upward trajectory, digital assets and equities are facing stagnation. Bitcoin has been fluctuating between $65,000 and $70,000 throughout February, briefly dropping below $60,000 earlier in the month. Currently, Bitcoin is trading near $65,500, witnessing a 2.8% decrease in a day.

On the other hand, US equities are under pressure, with the S&P 500 falling by 0.8% and the Nasdaq declining by 1.1%. Mega-cap tech stocks are particularly dragging down the market, with Nvidia shares plummeting by around 9% since Wednesday, dropping below $180 despite surpassing earnings expectations. This weakness is not limited to Nvidia but has also affected other tech giants like Meta, Amazon, and Alphabet. Investors are growing apprehensive about the substantial AI capital expenditures planned by these companies, projected to exceed $770 billion by 2026.