Gold vs. Bitcoin: The Battle for Your Wealth

Market Update - Wednesday, 11 Feb

It has been another stable day for the markets, closing on a positive note despite minor corrections throughout the session.

Looking at the big picture, a crucial element to observe is the dollar index chart. For the last 15 years, the dollar has followed a steady upward trajectory, but it is now beginning to break that trend. The U.S. administration appears to be doing everything in its power to devalue the currency.

The Nifty remained very flat today, up only 0.07%, but it is showing resilience by not giving up any gains and gradually inching upward. The last seven sessions have maintained an upward trajectory, and overall trends look positive.

• The Junior Nifty rose 0.5%, while mid-caps and small-caps remained flat at 0.02% and 0.13% respectively, recovering from intraday dips.

• Notably, the Nifty Bank closed up 0.2%, hitting a new all-time high.

• Gold is also at the cusp of a significant move, ending the day up 1% at 15650. If we see a two-day high close by tonight, it will likely provide a new tailwind for the metal.

• Silver also looked strong, up over 5% at 2,62,466.

Other Market Triggers

• The Nifty heat map reveals that IT stocks are being demolished. TCS is currently at an almost six-year low, hanging by a wire on a head-and-shoulders pattern; a breakdown here could lead to a very ugly fall. Infosys and the entire IT sector chart look horrible, reflecting a long-term stagnation that shows no signs of stopping.

• Conversely, Eicher Motors saw a 6% gain on good numbers, Maruti rose 1.7%, and State Bank of India ran hard with a 3% gain. Losses were seen in HDFC Bank, Coal India, Hindalco, and ITC. This highlights a clear shift in which sectors are lagging and which are performing, with commodities like Vedanta, Hindustan Zinc, steel, and energy stocks picking up steam.

• Other gainers included Divi's Labs and Britannia, while losers included LIC, IRFC, LTIM, HAL, ABB, and Gas Authority.

• TVS SCS was the mover of the day, surging 14% due to double-digit revenue growth, margin expansion, and strong performance in India and Europe.

U.S. Market Updates

• In the U.S. markets, the previous session saw significant drops for Charles Schwab, Intel, Intuit, Amgen, and Gilead, ranging from 3% to 7%.

• The NASDAQ fell 0.55%, the S&P 500 dropped 0.3%, and the Russell 2000 was down 0.35%.

• Within the NASDAQ 100, names like Costco, Walmart, and Amazon lost ground, while Intel lost the most at -6%.

What to watch next ?

• There has been a lot of misinformation regarding Sovereign Gold Bonds recently, leading some to react negatively to changes in taxation.

• While the government clarified that SGBs are not tax-free if bought from the secondary market—a point of contention for many—the situation is not as regressive as it seems.

• If you hold secondary market SGBs for two years or more, you pay a 12.5% capital gains tax, similar to other long-term assets.

• This is not a reversal of a promise but rather a clarification of a previously existing void. SGBs remain highly liquid, with 20 to 50 crores trading daily, making the idea that they are illiquid incorrect.

Read Full Article

Important Announcement

We are now live on our official WhatsApp Channel. We share all our strategy updates, rebalances, and important announcements here. Please watch this video to know more & join in at the earliest possible.

Join Now

Top Trending Strategies

What To Read This Week ?

Gold vs. Bitcoin: The Battle for Your Wealth

The debate is as old as the internet: Is Bitcoin truly "Digital Gold," or is it just a high-octane trading vehicle? Recent data from the last six months has shed a harsh light on this comparison, and the results might surprise you.

The Great Divergence: Numbers Don't Lie

Even with recent market cooling, Gold is up 42% in dollar terms over the last six months. Meanwhile, Bitcoin has faced a major correction, sitting roughly 35% down in the same period.

While enthusiasts point to Bitcoin’s astronomical gains over a 10-year horizon, the reality of the last five years tells a much flatter story. Gold, with its 5,000-year track record, continues to do what it does best: stay steady.

The Psychology of the "Drawdown"

Imagine your net worth is ₹1 Crore. You’ve allocated 30% or 40% of that into Bitcoin because you believe in the future of decentralized finance. Suddenly, the market dips.

• The Question: Can you actually stomach watching your ₹40 Lakhs drop to ₹4 Lakhs (a 90% drawdown)?

• The Reality: Even if the price recovers in three years, the level of uncertainty and the lack of a "comfort floor" makes it an incredibly stressful asset for preserving life savings.

Trading Thrills vs. Long-Term Hedges

There is no denying that Bitcoin is a world-class trading asset. If you are using stop-losses, longing, shorting, and playing the volatility, it is a goldmine (pun intended). However, a "hedge" is supposed to protect you when everything else is falling apart. In a crisis, you want an asset that preserves value, not one that adds a new layer of panic to your life.

Read Full Article

Meme Of The Day