China's Gold Buying Spree Fuels Debasement Trade

The debasement trade has seen gold and Bitcoin rise alongside each other since the start of this month, but the medium-term picture remains clouded. The US Dollar Index and USD price of gold have moved inversely, with the dollar falling as gold rises.

The West Texas Intermediate oil price has dropped 6% in three sessions, currently trading below $81 a barrel. This could give the US Federal Reserve cover to implement rate cuts, which would boost gold prices.

The Iran conflict was always intended to squeeze China's economy through energy markets. When China is squeezed, it buys gold as a financial asset, making its role crucial in determining how long this gold run lasts.