Libertex are launching Push For More, a brand new campaign in partnership with FC Bayern, the recently crowned 2022/2023 Bundesliga Champions. The campaign aims to engage and inspire people around the world to act with more confidence, trust and self-belief in order to achieve success.

The new brand campaign is the first we’ve created utilising FC Bayern players since we announced a multi-year partnership together in August 2022, which saw us becoming the first Online Trading Partner of FC Bayern for CFD and foreign exchange trading.

What’s in the campaign?

The joint campaign launch video features current FC Bayern stars Matthijs De Ligt, Eric Maxim Choupo-Moting and Leroy Sané, all wearing the new 23/24 season home kit.

The players explain how three basic principles (discipline, strategy and skill) have led them to where they are today, and how those qualities have pushed them to achieve success as a team and as individuals on and off the pitch. De Ligt talks about how mastering the art of discipline creates a sense of unity, Choupo-Moting explains why strategy is key to unlocking your full potential and Sané describes why skill gives you the ability to find the “edge” to achieve success.

Take a look at the full video, which is also available to watch on both Libertex and FC Bayern’s official websites and social media channels.

Words from our CMO, Marios Chailis:

“Libertex is more than just a trading platform, and FC Bayern is more than just a football club. Yet both organisations share a lot more in common than most would initially think. This campaign, the first collaboration of this kind, shines a light on this.

Combining the fast paced and exciting worlds of football and financial services, we share core values, such as trust, teamwork and a winning mentality. It was important for us to create something that highlights the synergies between both brands. Using inspirational and engaging content with first-team players, our Push For More campaign will help us successfully elevate and raise awareness of the Libertex brand utilising FC Bayern’s channels, in Germany and beyond.

FC Bayern are the benchmark for perfection and success on the pitch, which is something we want to apply to our millions of customers around the globe. We’re incredibly proud to continue our partnership with FC Bayern for the foreseeable future.”

FC Bayern x Libertex

Our multi-year sponsorship with FC Bayern currently runs until 2025 with the collaboration encompassing numerous activities such as visibility across FC Bayern’s social media channels, as well as a presence on the LED advertising boards at home matches in the Allianz Arena.

Last year was a famously strong twelve months for the US dollar, with the greenback stampeding its way to the top of the majors’ table amid high inflation and aggressive monetary policy from the Fed. Between achieving historic parity with the euro, some of the highest government bond yields in recent memory, and record levels of demand from both institutions and private investors, 2022 was one of USD’s best years on record. But that all appears to have changed now.

The dollar has been sinking like a stone against the other majors, and, far from trading 1:1 with the euro, the fibre is now back at pre-pandemic levels of 0.91 at the time of writing (10/05/2023). So, what’s behind this sudden downturn? Employment figures are better than good, and Treasury note yields are still high. The reasons for the ongoing USD decline aren’t immediately clear. In this article, we’ll explore some of the key factors at play as we attempt to predict what the future might hold for the dollar.

All hawked out

The relationship between central bank policy and a given currency’s performance is well established, and the US dollar is no exception in this respect. The Federal Reserve has been aggressively tightening longer and harder than any of the other major regulators and has now been forced to bring its hiking cycle to a premature end following the failures of several major banks, including the high-profile collapses of Signature and SVB.

And while the Fed did raise its funds rate once again this week, it was only by 25 basis points, and, as is often the case, it wasn’t what the regulator said that moved the markets but rather what it chose to omit. The US regulator’s outlook was markedly more cautious than many of its peers’, and it opted to drop all guidance about future rate hikes entirely. The US Dollar Index closed 0.42% lower on the day of the decision (03/05) and has held on to those losses for the past week. Markets are clearly pricing in the now-clear scenario that the Fed will be forced to stop hiking at 5.25%, despite setting its target rate closer to 6% earlier in the cycle.

Risky business

Anybody with money invested in the markets will be well aware of how devastating 2022 was for risk assets. There was a mass flight from risk, and, unsurprisingly, most of the capital flowed (at least temporarily) into US dollars. Along with gold and the Swiss franc, the greenback is the go-to risk-off asset, and last year’s fear and anxiety surrounding rampant inflation and general uncertainty quite predictably translated to dollar strength.

The big story of 2023 so far is the resurgence of risky instruments like crypto and stocks, so it’s unsurprising that we should now be seeing the dollar correct back to more reasonable levels, historically speaking. Bitcoin is currently up almost 70% YTD, while the S&P 500 is up almost 10% over the same period. Even high beta fiat currencies like the Aussie dollar have recorded modest gains following the latest FOMC meeting. For most traders and investors, the tentative reversal of the protracted bear market is an overwhelming positive, even if it does mean a short-term decline in the US dollar. Provided that a major devaluation can be avoided, a reasonable correction from late 2022 levels would probably be best for both the dollar and the US economy.

Just try and stay positive

Given the wholesale doom and gloom being spread around of late, it’s important to note that the US economy is, in fact, looking extremely healthy right now. Unemployment is at a more than 50-year low of 3.4%, a level unseen since the Summer of Love in the late 1960s. Meanwhile, the latest non-farm payrolls indicated 253,000 new jobs were created in April. This absolutely obliterated all forecasts, the most optimistic of which hovered around just 165,000.

Looking at Treasury yields now, we are also seeing a very positive dynamic. The two-year government bond has risen back above 3.92% after visiting 3.56% last month, representing a strong sign of confidence in the US national currency. While both a strong labour market and high T-note yields are traditionally good for the dollar’s paper value, too, investors shouldn’t be perturbed by the USD’s failure to turn strong fundamentals into real-world gains. We would all do well to remember just how high the dollar rose in 2022 due to a combination of geopolitical uncertainty, hyperinflation and central bank policy divergence. A correction is not only perfectly understandable, it’s absolutely necessary to ensure the competitiveness of US exports and the stability of the monetary system at large.

Trade CFDs on currencies with Libertex

Whether you think that the US dollar will continue its downtrend or that the foundations have now been laid for stable growth, you’ll always be able to throw your hat in the ring with Libertex. Because we offer both long and short CFD positions on a range of key majors like EUR/USD, GBP/USD and JPY/USD, as well as more exotic pairs like CHF/USD and AUD/USD, you’re sure to find an underlying asset and direction to suit you. With ultra-low spreads from 0.2 pips and leveraged trading up to 30:1, Libertex offers some of the most competitive terms around. Beyond currency pairs, Libertex also offers CFD trading in the US Dollar Index, core stock indices, and more! To find out more about what Libertex can offer you or to create your very own trading account, visit www.libertex.com/signup


Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 85.9% of retail investor accounts lose money when trading CFDs with this provider. Tight spreads apply. Please check our spreads on the platform. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

A little over a month after UBS's landmark acquisition of Credit Suisse was announced, we are finally seeing the first results of one of the highest-profile mergers and acquisitions in banking history. As part of the deal brokered by Swiss regulators, UBS paid 3 billion Swiss francs ($3.25 billion) for Credit Suisse, around 60% less than the bank was worth when markets closed on Friday, 17 March. Although many of Credit Suisse's shareholders and additional tier-one bondholders were totally wiped out by the takeover agreement, the hope was that it would help protect the historic Swiss institution's whopping $1.7 trillion of assets under management while averting a potentially devastating GFC-esque banking crisis.

It might seem melodramatic at first glance, but we would do well to remember that Credit Suisse ate through nearly 20 times the amount of the agreed purchase fee in the days leading up to the announcement amid daily net withdrawals of around $10 billion. Indeed, even a $54 billion loan from the Swiss National Bank failed to stop the bleeding. But now, as UBS releases its first quarterly results since this 'shotgun' acquisition, many traders and investors are wondering whether the deal is set to achieve its desired aims and, if so, how are the world's markets likely to respond.

So far, so good

It's obviously far too early to tell, but the initial responses from both markets and private wealth have been rather encouraging. Perhaps the most visible positive is the near 10% share price increase we've observed over the past month, demonstrating that investors are confident in UBS's ability to steady the ship and deliver new growth in future years. In its Q1 report, UBS also noted that it has managed to attract $28 billion in new money to its global wealth management unit. While only totalling about half the amount that was lost during the final throes of Credit Suisse's asset management business, it is certainly a step in the right direction.

Of course, it's far from all good news. UBS did underperform significantly compared to analysts' initial predictions, with net profit down 52% to just $1.03 billion amid projections of $1.75 billion. However, it's important to note that these forecasts were made well before the unexpected and somewhat forced takeover of Credit Suisse, which was always going to have a significant negative impact on the bank's bottom line. If this trend continues through to Q4, we could certainly take it as a good sign that a full-scale European banking crisis is now unlikely and inflation is somewhat under control.

Don't bank on it

This most recent banking crisis began with the simultaneous collapse of crypto-friendly lenders Silvergate, Silicon Valley Bank and Signature Bank. Other banks, such as First Republic, were lucky to survive what has since been termed "the first Twitter-fueled bank run". While the Swiss regulator might have expertly managed to avert what would have been a catastrophic failure for European capital, it could've easily gone the other way. Therefore, with many European banks still dangerously undercapitalised, there is every chance that we aren't quite as lucky next time round.

Despite ECB President Christine Lagarde's affirmations that "the euro area banking sector is resilient, with strong capital and liquidity positions" and that "the ECB's policy toolkit is fully equipped to provide liquidity support to the euro area financial system," concern is nevertheless strong among ordinary market participants and economists alike. The biggest worry is that any large-scale programme for rescuing Global Systemically Important Banks (G-SIBS) like Credit Suisse could lead to the creation of behemoths, which, in the words of German economist Hans-Werner Sinn, could turn out to be "too big to bail". Let's not forget that UBS needed its own bailout just 15 years ago, and if such a situation were to arise again in its new enlarged form, even the IMF would struggle to finance it.

Trade stocks and more with Libertex

Libertex is an experienced CFD broker with a long history of providing access to the financial markets for traders and investors in EEA and Switzerland. We offer CFDs with a diverse range of underlying assets, including forex, crypto, commodities, and, of course, stocks. Because Libertex offers both long and short positions in a wide range of instruments, you can potentially benefit from any movements in the markets.

With us, you can trade CFDs of a range of major business and private banks, including BNP Paribas, Citibank, JPMorgan Chase, and Goldman Sachs. For a more conservative and wide-reaching strategy, you could try CFDs in major US- and Europe-based ETFs and Index funds, such as the Vanguard FTSE Europe, the SPDR S&P 500 and theiShares Core US Aggregate Bond ETFs. For more information about trading or investing with Libertex or to create your own account today, visit https://libertex.com/signup


Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 85.9% of retail investor accounts lose money when trading CFDs with this provider. Tight spreads apply. Please check our spreads on the platform. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Bitcoin's 2022 descent was almost as spectacular as its rise a year earlier. After tripling in value to reach a high of $64,440 in November 2021, it gradually slipped to a local low of $16,450 twelve months later. Amid the second round of lost fortunes, ensuing bankruptcies, and assorted scandals — FTX probably being the most notable — many pundits were quick to write off cryptocurrencies as still nothing but a speculative fool's errand. And don't even get them started on altcoins!

Fast forward just six months later, and it seems that many have since considerably changed their tunes. Since the lows of November 2022, Bitcoin has gained almost 80% and has now reached a goal of $30,000 at the time of writing (11/04/2023). But it's not just BTC that has had a solid Q1. Solana is also up over 100%, while Dogecoin and Ethereum have managed to gain around 50% over this same period. So, what's bringing the bulls out of hiding? And what might the future hold for digital assets and their investors?

Getting institutionalised

Perhaps the biggest shift in the digital currencies market of late has been the active adoption by institutional investors. Cryptocurrencies were previously viewed as an inherently volatile and uncorrelated asset class that had no place in serious portfolios, but all of that changed in the last 24-36 months. Back in 2020, annual institutional inflows into crypto stood at a respectable $6.8 billion, but just one year later, they had gained 36% to reach an unprecedented $9.3 billion. Even after the severe flight to safety in 2022, total crypto assets under management by institutions are still around $30 billion. A recent study by Fidelity Capital showed that nearly 80% of investment funds were "interested" in crypto, but of these, only 12% have held digital assets for two years or more.

Regulation is a major restricting factor for more conservative institutions, and with the PwC Crypto Regulation report stating that a majority of global regulators have either enacted regulatory schemes for dealing in digital assets or are on the brink of doing so, it's expected that this barrier will fall in 2023. Indeed, the data show that Bitcoin institutional inflows are once again positive after over a year of net outflows. Last week's $2.5 million BTC inflow might look modest, but this could be the turning point that signals the development of a bull market. 

Risk appetite remains

In the wake of the Fed's aggressively hawkish policy to combat inflation, risk assets fell significantly as investors moved wealth to gold and the US dollar. However, the recent collapses of SVB and Signature, as well as the shotgun takeover of ailing Credit Suisse, have all forced the US regulator to put the brakes on its monetary tightening programme. Now, crypto might well be a difficult market to call, but if one clear pattern has been identified since the market's inception a decade ago, it's that digital assets do not perform well in a risk-off scenario. But the interest in major coins like Bitcoin, Solana and Ethereum is more than mere speculation. Since the arrival of serious institutional capital, Bitcoin and Ethereum are now genuinely viewed as stores of value and with prices at multi-year lows, it made sense for people to start buying in early 2023. Behind Solana's superior performance, meanwhile, is another factor altogether. Its rapid transaction speeds, immense scalability, and interoperability have made it an attractive investment ahead of the coming metaverse revolution. Of course, it is this more risk-friendly atmosphere that has facilitated investor activity. Whether we see a true bull market emerge will largely depend on if this sentiment is maintained for a reasonable length of time.

Fundamental volatility

Like any asset class, cryptocurrencies are also highly influenced by fundamentals. And the crypto news climate has been mixed, to say the least. This probably explains the rally-correction cycles we've seen since late 2022. One of the biggest sources of volatility this year has been the decision by the Commodity Futures Trading Commission (CFTC) to bring charges against Binance for breaching the law. Although BTC's price responded by dipping below $28,000, it soon recovered to regroup above $29,000 within just a few hours. While some see a case like this as a negative factor, others would consider it a step in the right direction when it comes to regulation and, hence, the lack of a clear, uniform response to the news.

Beyond Bitcoin, another huge development in the cryptosphere came from none other than Twitter's new owner, Elon Musk. The larger-than-life Tesla and SpaceX CEO moved markets as he changed Twitter's emblematic bird logo for the iconic Doge Shiba Inu dog. As one might expect, Dogecoin responded positively, gaining 25% in the space of just a day. Musk has long been a proponent of Dogecoin, and an almost cult of personality has developed around him among fans of the canine coin. Could this move be a cryptic hint that Dogecoin could become the official digital currency of Twitter? If so, this would obviously be very good for the memecoin's long-term prospects.

Diversify your trading with Libertex

With multi-decade experience in the market, Libertex is a famous name in the online trading space. Our wide variety of CFDs now spans numerous asset classes, from stocks and ETFs all the way to commodities, cryptocurrencies and even options. Libertex offers CFDs on over 100 digital underlying assets, including Bitcoin, Dogecoin, Solana and Ethereum, as well as crypto-related CFDs on stocks, such as the Grayscale Bitcoin Trust. Best of all, you are now able to enjoy 0% commission and ultra-tight spreads on all crypto trades made with Libertex. For more information or to create an account today, visit www.libertex.com


Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 85.9% of retail investor accounts lose money when trading CFDs with this provider. Tight spreads apply. Please check our spreads on the platform. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

In a matter of days since the collapse of Silicon Valley Bank and Signature Bank, yet another behemoth of corporate finance has had to be pulled from the jaws of bankruptcy in what has been dubbed a “shotgun wedding” takeover. Long-maligned Credit Suisse has finally bitten the bullet, with UBS forced to absorb the ailing business bank and its $5 trillion of invested assets. Optimistic analysts are claiming that this finally draws a line under the questions about Credit Suisse’s viability, while their more pessimistic colleagues are pointing to potential signs of contagion much like during the 2008 GFC that could spell catastrophe for the world’s already precarious financial markets. So, who’s right and what does this mean for traders and investors in the short term?

Devil’s in the detail

The collapse of SVB and Signature was by no means a drop in the ocean – they now rank in second and third spot respectively in the US’s biggest bank failures of all time. However, their highly speculative activity predicated on the unsustainably high stock prices of 2020-2021 made them especially vulnerable during this extended bear market. Credit Suisse is a completely different animal altogether. This is a Swiss national institution with a history dating back to 1856 and a much broader spectrum of activity than its US counterparts. With major investors including the Saudi National Bank and Qatari Investment Authority, Credit Suisse is a major global player with influence on a wide variety of asset classes and businesses. For this reason, its failure would have far-reaching effects on world markets, which is most likely why it wasn’t allowed to go the same way as SVP and Signature.

A long time coming

It might have come as a shock to hear that a bank with a 167-year history has gone under, but this failure has been building for some time now. Over the past two years, Credit Suisse’s stock price had fallen 84%, while its new owner UBS had managed to cement 15% gains over this same period. Last year, Credit Suisse posted a loss of over $7 billion, and just a week before the eventual $3 billion takeover, it was valued at just $8 billion. Indeed, amid mass depositor panic that saw tens of billions of dollars being withdrawn each day, the Swiss government provided the bank with a bridge loan of $54 billion – all of which has now been spent. In fact, so dire is the situation that the Swiss National Bank has even agreed to provide a further $108 billion in funding to UBS in order to boost Credit Suisse’s liquidity over the long term. As a result of this entire debacle, even UBS’s share price has taken a hit of more than 10% over the last week alone.

Why worry?

There are many who would say that these are just three overleveraged banks whose chickens have come home to roost and there’s no sign of wider contagion like in 2008. And while that would certainly be true enough for SVB and Signature, Credit Suisse is a totally different matter. Its own shareholders have already lost over 50% of their investment following the post-takeover share swap, while the bank’s AT1 bondholders have been left with nothing. It has been made clear that the bank is still far from out of the woods and, with over $5 trillion in invested assets, a future collapse would be absolutely disastrous for markets everywhere. This loss of principle by the AT1 bondholders has already provoked a rout on the European convertible bonds markets, which could lead to further trouble for the banking sector at large. Analysts are also predicting a general dip in demand for risk assets until confidence returns. Nothing is certain just now…and that’s part of the problem. But if another major bank falls into trouble, then it could well be time to panic and consider increasing one’s gold allocation.

Trade any trend with Libertex

As one of Europe’s leading CFD brokerages, Libertex provides competitive terms on a wide range of instruments and asset classes. Beyond CFDs in individual stocks like Deutsche Bank, Goldman Sachs, and Citigroup,  and a range of indices and ETFs, such as the S&P 500, DAX, and EURO STOXX 50. We also provide CFDs in gold and silver. For more information or to create your own account, visit https://libertex.com/signup


Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 89.1% of retail investor accounts lose money when trading CFDs with this provider. Tight spreads apply. Please check our spreads on the platform. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Oil is the lifeblood of the global economy. Without it, goods cannot be moved or even produced; people cannot get to and from work or shops; and food cannot be farmed, packaged or transported. It's no coincidence, then, that the price of oil is directly correlated with economic health and prosperity. A prime example of this was in March 2020, in the wake of the COVID crash, when Brent prices turned virtually negative. Countries were locked down, factories shut, and domestic travel severely restricted. Of course, it was basic supply and demand. Nobody needed fuel, so its price collapsed. But as the caveat of one famous expression states, "what goes down must also come up".

After two years of yoyoing in lockstep with pandemic policy and supply-side pressures, oil appears to be levelling out, with the market leader Brent now standing at around $82.30 per barrel (27/02/2023). However, this is still well above the ten-year average and — with above-target inflation and a general climate of uncertainty — it represents serious headwinds for the manufacturing and transport sectors, as well as the wider economy. As central banks continue to raise rates and oil-producing nations look to balance demand and supply, 2023 is shaping up to be a key year for this energy resource. Now, without further ado, let's look at what is causing the current price instability and try to predict the most likely movement for this crucial commodity going forward.

Demand choppy amid dismal data

The world still hasn't fully recovered from the coronavirus crisis of 2020. Things might seem as though they're back to normal, but the economic fallout of this unprecedented global black swan is still thick in the air. Rampant inflation caused by excessive quantitative easing during the acute phase of the pandemic is driving up all commodities, oil included. However, a side effect of this is diminished buying power and highly volatile consumer sentiment, which has meant manufacturers have had to adjust production regularly.

In fact, the typically linear durable goods orders chart was an uncharacteristic picture of ups and downs in 2022. Since February 2022, four out of eleven of the months studied showed a decline, with the four-month period from March to June marking the most consecutive rises of the year. Coincidentally (or perhaps not), it was during this same period that oil prices hit their June local maximum of over $120 per barrel. Meanwhile, the US ISM PMI has been in a steady decline from 58.6 to 47.4 over the same time frame, having spent the past three months below the key minimal level of 50. Unsurprisingly, oil's movement has virtually mirrored these two indicators, with Brent gradually having lost almost 35% since June. Whether the business climate will improve is yet to be seen, but if it does, we could then expect oil to rise.

Everything's cheaper in China

After lagging severely behind for much of 2022 following the CCP's much-criticised zero-COVID policy of sweeping lockdowns, which led to severe drops in oil consumption from both ordinary consumers and big industry, the situation appears to be normalising now in China. Analysts now predict the Asian giant's oil imports to hit a record high in 2023 amid increased transportation demand and the arrival online of new Chinese refineries. Indeed, OANDA senior markets analyst Craig Erlam has claimed that the optimism around post-corona China — the world's largest importer of oil — may have something to do with the gains we're seeing in crude.

China and India have become major importers of Russian oil amid Western sanctions, embargoes and price caps on the OPEC+ member. In India, too, government crude imports data hit a six-month high in January. Essentially, the geopolitical instability in Europe and the associated measures imposed on Russian oil has seen two markets emerge. As a result, Urals crude currently sits at around $49.70 a barrel, representing a hefty 40% average discount on Brent. For non-aligned countries like China and India, this is a huge boom that means that they are not only able to meet potentially high demand in 2023 but will also be able to save billions of dollars in transport and production costs. However, with Russia this week reducing its output, we could soon see both Urals and Brent rising in the short-to-medium term.

What do the technicals say?

Very much in line with the fundamentals we've already covered, the technical analysis is similarly mixed. Both Brent and WTI have conflicting signals, and it appears we will need to see a convincing move in one direction before any truly actionable signals will be forthcoming. The weekly and monthly charts for the US's big two crude varieties seem to range anywhere from sell to strong sell, though the MACD for both of these timeframes rather confusingly suggest that current prices represent a good deal for prospective long-term holders.

If, however, we move over to the daily, 5-hour and 1-hour charts, a completely different picture emerges. The number of indicators flashing Buy increases exponentially as we reduce the charts' timeframes. On the 1-hour, for instance, the RSI, MACD, ADX, CCI and Bull/Bear Power all recommend buying. As such, it would appear that day traders could certainly consider picking up both Brent and WTI at current levels. For longer-term investors, it might be wise to take a wait-and-see approach until we have some much-needed clarity on some of the fundamentals detailed above.

Trading CFDs on oil with Libertex

Libertex is an experienced CFD broker renowned for its low commission, tight spreads, and multi-award-winning trading app. Apart from CFDs on Forex, stocks and ETFs, Libertex also offers CFD positions in a wide range of energy commodities, including WTI Crude, Brent and Light Sweet Crude. Since Libertex allows you to open long or short positions in any of its tradable instruments, it doesn't matter which way you believe the market is headed. For more information or to open your own live account, visit www.libertex.com and join the ranks of Libertex clients worldwide.


Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 89.1% of retail investor accounts lose money when trading CFDs with this provider. Tight spreads apply. Please check our spreads on the platform. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Investors could be forgiven for thinking precious metals have been trading flat this past year or so, with prices more or less at the same level as they were before the COVID pandemic. However, what many forget to factor in is that the last 12 months have also been characterised by historic strength for the US dollar. Even leaving aside the mid-summer highs, when the greenback was well above parity for some time, the USD is still worth almost 15% more in euro terms than it was pre-pandemic. This effectively means that gold has not only held its value over this turbulent time, but it has also actually recorded double-digit "real world" gains.

Now, starting from Q3 2022, gold and silver have practically exploded, rising between 10-15% in the space of a few months. It might not sound like much, but — by precious metals standards — that is quite a pronounced trend. Is this a sign of an incipient bull cycle, and what are the driving forces behind this strong movement from an otherwise reserved asset class? In this article, we will hopefully be able to answer these questions and more, shedding some light on the long-term outlook for gold and silver into 2024 and beyond.

Position 1: Dollar weakness works up metals

As we touched upon above, the USD had one of its strongest years in over two decades in 2022. But as any investor will tell you, what goes up fast must come down equally as fast — and this is precisely what we're seeing play out now with the greenback. From a high of 1.04 in late September of last year, the EUR/USD cross rate is now down more than 10% to 0.93. The upshot of this is that gold's "real world" gains, which were previously only visible when compared against the euro, have now become apparent in dollar terms, too.

Add to this some natural increase in precious metals demand on account of ongoing geopolitical instability and above-target inflation, and gold and silver's seemingly rapid appreciation makes logical sense. Amid softer 10-year US Treasury yields of 3.61%, the risk-off sentiment is fading, and we can confidently expect the yellow metal to keep going above $1,880.00. Furthermore, the Federal Reserve is tipped to complete its tightening cycle by year-end, and with these subsequent hikes largely priced in already, the path is clear for gold to rise further without the headwinds of a strong dollar.

Position 2: All about inflation

After a truly torrid couple of years for the global economy, it might feel as though the worst is behind us. This might well be true, but we're definitely not out of the woods just yet. Geopolitical uncertainty in Europe and the Pacific and ongoing inflationary uncertainty mean that risk-off assets like gold and silver remain attractive hedges to diversification-seeking investors of all stripes. In fact, while the Federal Reserve and other major world central banks are expected to reach their terminal rates with total additional hikes of under 100 basis points, this is by no means set in stone.

If inflation doesn't drop below 4%, global regulators will be required to keep tightening, which will only increase demand for precious metals. The Canadian bank CIBC sees gold and silver prices averaging around $1,800 and $23.50 an ounce over 2023, which is roughly 5% below current prices. Meanwhile, April gold futures were trading around $1,887.30 per ounce at last week's end (10/02), while March silver futures stood at $22.35. However, once again, these prices are predicated on only 1-2 additional rate hikes in 2023. If we see more, all bets are off.

Position 3: What about stocks?

Aside from metals ETFs, investors can also gain exposure to gold, silver, and other precious metals by purchasing stocks in mining companies. Obviously, this is not a strategy for everyone, but the increased volatility of mining and royalties equities can mean better gains while also providing a greater degree of diversification across all the commodities that the company in question trades in. Another undeniable advantage of such stocks is that they typically benefit from some pretty solid dividends. Vale, Barrick and Rio Tinto are all stable and well-established players in the precious metals mining sector and remain at very attractive valuations despite average gains well above that of gold and silver over the past six months. Barrick is up over 20%, while Vale has managed around 30% over the same period. But the sector leader is Rio Tinto, with gains of nearly 50% since September.

Meanwhile, these mining giants offer very generous dividends of 2.93%, 8.86% and 7.84%, respectively. Despite these market-beating price gains and relatively high dividend yield, Vale is still rated a Buy by a majority of Wall Street analysts, and its 18.64 average price target represents a potential upside of 10%. If, however, inflation remains high and investors' risk appetite is reduced once more, we could well see even bigger returns.

Go for gold (or silver) CFDs on metals with Libertex

With Libertex, you can trade CFDs in a wide range of assets, from stocks and ETFs to cryptocurrencies and, of course, commodities. Aside from gold (XAUUSD) and silver (XAGUSD), Libertex also offers CFDs in other precious metals like copper, platinum and palladium. Best of all, Libertex gives you the option to hold both long and short positions in any of the available assets, which means you can have your say, no matter what you believe the dominant trend to be. For more information or to create a live trading account of your own, visit www.libertex.com


Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 89.1% of retail investor accounts lose money when trading CFDs with this provider. Tight spreads apply. Please check our spreads on the platform. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.