It’s been hard being a gold bug these last 7 years. We’ve been mocked and discounted as preppers who live in a fantasy world where disaster awaits the global financial system at every turn. We’ve been called stopped clocks and permabears, with some justification. By the numbers we’ve been wrong, at least since 2011. In the end, numbers are all that matter in this business.
Precious metals have been watching the dollar and interest rates over recent months, and they are getting conflicting signals. The dollar index tanked throughout 2017, and at the start of 2018, the selling continued. The recent rise in the price of precious metals from the middle of December has been a reflection of the diving value of the dollar against other world currencies, particularly the euro.
Gold could hit levels last seen in 2013 if the dollar extends its slide and equity markets reverse. Bullion at $1,400 an ounce is “achievable” in the next two months, Stephen Innes, head of trading for Asia Pacific at brokerage Oanda Corp., said in an interview Thursday. The Bloomberg Dollar Spot Index plunged to the lowest since 2014 after Treasury Secretary Steven Mnuchin endorsed the currency’s drop at the World Economic Forum in Davos.
Gold futures gained Tuesday to mark the highest finish since early September, even as a closely watched U.S. dollar index tried to end its streak of declines. “The near-term trend remains higher for gold, and that is in line with inflation taking hold,” said analysts at the Sevens Report. “That, in turn, is weighing on real interest rates, which is bullish for gold.”
Palladium futures on Thursday climbed past $1,100 an ounce for the first time on record, leaving some traders to wonder whether palladium has the ability to continue its rally and surpass the value of gold.
Remember gold? It seems like only six years ago the shiny metal was flavor of the month, hitting a record $1,900 a troy ounce while its backers prophesied the end of the fiat money system.
Gold held near a two-month low on Wednesday, under pressure from an advancing dollar ahead of a vote on the U.S. tax reform plan, but a potential government shutdown lent support to prices. Spot gold had inched 0.1 percent lower to $1,264.260 an ounce by 14:20 GMT after it hit its weakest since Oct. 6 in the previous session.
Chart Patterns The prices of the metals dropped $20 and $0.39, a downhill slide interrupted on Thursday by speculation fueled by some economic data, and which resumed on Friday.
Since the beginning of 2017, gold has traded on an upward trend, with a high correlation to the Trump stock market rally. You may be surprised that in the eight worst stock market corrections since the early 1970s, gold is not always a “safe haven”. This article assesses the relative attractiveness of gold as an investment today to preserve portfolio value should a market correction occur. Many investors I have spoken with recently share a…
“For centuries, investors and savers have depended on gold in times of economic and political strife, and its investment case right now is as compelling as it’s ever been.” As I write this, gold is trading above US$1,330 an ounce after a strong rally that took the metal to its highest levels since August 2016. Tensions over North Korea, a weakening US dollar, political uncertainty in Washington, an overvalued US stock market, surging public and…