Gold and The USD Index.....
I think that it is time to revisit both gold and the US Dollar. There is not a lot to write about either instrument as you have heard me comment about them before. I told you many months and years back that the Dollar is simply in a sideways market devoid of volatility. That range as you can see from the chart is between 100 and roughly 90. Yes, it has hickupped a little above and below these levels but for the most part, you can see where the volume enters into the markets. This is the way it has been since 2014.
Is it headed down to zero?
Is the US headed for bankruptcy?
Is gold going to the moon as a result?
The Dollar is not going anywhere just yet. It is still the world's reserve currency and there is no better alternative that could be trusted to do the world's transactions at the moment. There may be a digital alternative to the dollar in the not too distant future when we go cashless (yes this is coming) but I highly doubt that the Dollar is going anywhere other than in its range just yet. Not to worry I will let you know in plenty of time if there is going to be a catastrophe.
If you believe the US is headed for bankruptcy proceedings then you are sadly mistaken. Debt to GDP has been worse in the past and the economy (thanks to the creation of so much debt) is doing just fine at the moment.
The main reason I am posting is that gold has just about hit my initial target as you can see from previous charts and the chart below. I bought again when gold dipped and I told you to do the same as I added to the winner after taking some profits. The 1602 mark is pretty pivotal. If gold gets by this area it should head to the 1700 and beyond area pretty quickly. I am long gold against most major currencies as it continues to make new highs against them.
Gold is generally a hedge against inflationary pressures, not deflation. I still think that we are in more of a deflationary problem so I doubt that it will move up too fast. You have to keep in mind that the price of gold is controlled by the paper market so make no mistake about who is really in charge of the price. If it is rising it is generally for a good reason or it wouldn't be. Anyway, I will keep you updated and if gold is likely to head to the moon I will let you know. For the time being, I doubt that is going to happen. Cheers!
Is it headed down to zero?
Is the US headed for bankruptcy?
Is gold going to the moon as a result?
The Dollar is not going anywhere just yet. It is still the world's reserve currency and there is no better alternative that could be trusted to do the world's transactions at the moment. There may be a digital alternative to the dollar in the not too distant future when we go cashless (yes this is coming) but I highly doubt that the Dollar is going anywhere other than in its range just yet. Not to worry I will let you know in plenty of time if there is going to be a catastrophe.
If you believe the US is headed for bankruptcy proceedings then you are sadly mistaken. Debt to GDP has been worse in the past and the economy (thanks to the creation of so much debt) is doing just fine at the moment.
The main reason I am posting is that gold has just about hit my initial target as you can see from previous charts and the chart below. I bought again when gold dipped and I told you to do the same as I added to the winner after taking some profits. The 1602 mark is pretty pivotal. If gold gets by this area it should head to the 1700 and beyond area pretty quickly. I am long gold against most major currencies as it continues to make new highs against them.
Gold is generally a hedge against inflationary pressures, not deflation. I still think that we are in more of a deflationary problem so I doubt that it will move up too fast. You have to keep in mind that the price of gold is controlled by the paper market so make no mistake about who is really in charge of the price. If it is rising it is generally for a good reason or it wouldn't be. Anyway, I will keep you updated and if gold is likely to head to the moon I will let you know. For the time being, I doubt that is going to happen. Cheers!
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