Prices of gold (GC=F) have soared, breaking the $2,100 mark as investors bet on potential rate cuts. Phillip Streible, Blue Line Future Chief Market Strategist, joins Yahoo Finance Live to share his perspective on why the precious metal could be an attractive investment.

Streible says, "there is a perfect storm brewing in the gold market," with the commodity climbing $150 "above its February lows." He explains that in the event of a regional bank crisis, the Federal Reserve may "pull forward" anticipated rate cuts originally slated for May or June, providing a tailwind for gold to rally further.

The strategist also highlights that the forthcoming jobs report on Friday will offer crucial insights into rate cut expectations and inflationary pressures. He suggests that a figure below 200,000 could "expedite the prospects of an interest rate cut," although he urges caution regarding "seasonal factors" that may influence job market data.

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor's note: This article was written by Angel Smith

Video Transcript

SEANA SMITH: Gold prices hitting an all-time high rising above $2,100 as investors bet on potential rate cuts soon. Now our next guest urging traders to be cautious navigating this landscape. We want to bring in Phillip Streible. He's Blue Line Features chief market strategist. Joining us now, Phillip, it's great to see you again. So here we are with gold prices right around $2,100. Now it is important to point out just in terms of when you adjust it for inflation, gold actually set a higher highs when you look back to the 1980s and some of the prices that we have seen in the past.

But taking into account where we are today, gold just above $2,100. Philip, do you think there's more room through the upside?

PHILLIP STREIBLE: Oh, I think so. We've got a perfect storm brewing in the gold market with opportunities in silver. I mean, we're $150 above the February lows. You've got US and European inflation data that's been weakening in the prospects of the Fed, the ECB, and the Bank of England all to have interest rate cuts are rising. So in May, we're expecting about a 23% chance that the Fed will cut rates. You go out to June, it's about a 65% chance.

But I really think some of the details of this gold rally because if you look when we took off, it was basically Thursday near the close is when gold futures really started to get their legs. And I think that there's another regional bank crisis that's lingering in the background. Since that close on Thursday, New York bank has been down 38%. And I think that the reality is that you're seeing this short covering because of the fact that if you do have some bank failures, some regional bank risk, you're going to see it pull forward those interest rates cut expectations by the Fed. And they'll end up making those cuts a little bit sooner.

BRAD SMITH: And in that case, we'd also be apt to keep tabs on any incoming economic data. Is there one particular prince that has a more out-sized impact on gold as it translates to the rate cut probability?

PHILLIP STREIBLE: Well, of course it's going to be the jobs number on Friday. If we see any number that's below $200,000, I think that will expedite the prospects of the interest rate cut. The last number was about 353,000, so it blew the socks off. That's when we saw prices come down. But now that I believe that some of these seasonal factors have come out of the market here as far as the job market. I think that there's significant under investment also in the gold market right now.

If you look at the ETFs, it's been just nothing but a series of outflows on that market. Even with prices going up, we saw about $155 billion in ETF outflows out of the GLD market. Perhaps those were people that bought that recent record high that occurred on a Sunday night into a Monday. And they've been holding on to that. Now we're seeing that rotation out of gold and into Bitcoin which is attracting about $1 billion a week in ETF inflows.

BRAD SMITH: And that's what I was just about to ask you Philip. How much of that gold outflows in the ETFs are we seeing now flow into digital gold?

PHILLIP STREIBLE: Yeah. I mean, the reality is that I think that there's a place for both physical assets and also digital assets in people's portfolios. I think that will help them against a macroeconomic backdrop here that is starting to waffle a bit. And then also it will help with the purchasing power going forward. So I think it's a play for both portfolios. If you look at when the GLD started about 2004, over the course of the next seven years, those ETF inflows that went into that asset class took gold from $400 an ounce on up to a record high of about $1,850 an ounce.

That's why we believe that with the way the ETF is setting up for Bitcoin, we could easily see $100,000 Bitcoin at the end of the year and perhaps two and three years out $250,000.

SEANA SMITH: Phil, what do you think the price of gold looks like a year out?

PHILLIP STREIBLE: Well, I think we could be easily back at $2,500. If you go since 1990, within the first 30 days of the first interest rate cut, gold futures on average have had a rally of about 6%. So if you go 6% from here, that's going to be about another $150 higher. So I think $2,500 is a realistic target. The key catalyst on the gold market is the timing the pace and the depth of the interest rate cuts. The Fed has really two options, they go slower and sooner, start in March, or they got to go faster and later starting in June.

And if they do that, that's where things can really get a bit haywire on the gold market. And I think that again with the gold silver ratio sitting around 89 that you could see a really aggressive move on silver higher.

BRAD SMITH: Since you mentioned silver, what's going on with the level of resistance, this thick area as you define it, in resistance that's taking place within silver.

PHILLIP STREIBLE: Well, silver-- the range on the upside where we've run where we started the pump, the brakes has really been 24 to 26. Remember China is one of the largest consumers of not only silver but also copper. And with solar stocks under significant pressure, they're one of the most heavily shorted sectors in the market. I think that there are some headwinds for the silver market.

But like any balloon being held underneath water, eventually when it comes to the surface, it explodes significantly higher. So we do believe that we've captured some key levels of resistance. Just in the last two days, silver has gone through the 50-day moving average, 23, 32 also above the 200-day moving average at $2,402. I would say your line in the sand is going to be that 50 day if we go back below it prices could be just rolling over.

And this was nothing more than a head fake. On the gold market your critical level supports $2,100. Below, that's going to be the 50-day moving average at $2,055.

BRAD SMITH: Phil, we got to go. Is there one metal that you're tracking that perhaps is annexed to this boom that we've seen in semiconductor demand?

PHILLIP STREIBLE: Copper market could easily take off to the upside. We could see $4 even 450 copper if China starts doing some stimulus measures.