Venture: Update

Issue 118;

The problem is that gold and, especially, silver are trading as risk-ON assets. Therefore, to add new related companies, I would want to see this relationship cool or at least be in a stronger market environment.

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In January, the gold price was going up, and everyone knew it. It had a ByteTrend score of 5, meaning the price traded above two rising moving averages. It also regularly made new 20-day highs while avoiding lows. The thing I gain most from ByteTrend Scores is their impartiality. Gold is now a 2, which is not an opinion but a statement of fact.

Gold ByteTrend Score

Source: Bloomberg

On the other hand, aluminium, where production largely reflects the price of electricity, is surging, scoring a 5 on the daily, weekly and even monthly charts.

Aluminium

Source: Bloomberg

Then, comparing aluminium with gold since the mid-1980s, it reminds us how far industrial metals have been left behind, lagging the gold price by 80%. Yet, until 2008, these had traded in a range.

Aluminium vs Gold

Source: Bloomberg

These long-term relationships, which sometimes break down, make you think about how things could change. Gold is a store of value, but aluminium is more of a store of energy. It makes me wonder how much things could change should this energy crisis persist.

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