Wednesday, July 26, 2017

Gold's Fate Driven By Investor Confidence $GLD

News
Rising US rates and falling confidence in the management of the Euro and European banking system has been driving the dollar higher (Euro lower) since 2017. The bears, citing a well-defined downtrend from the 2017 high as continuation of the bear market, fail to recognize it as consolidation within an uptrend that began in 2014. These trends, potentially drivers of rapidly accelerating trends in US stocks, the dollar, gold, and collectibles that the majority will incorrectly interpret as an economic boom rather than a byproduct of flight of capital flows, will hold as long as capital remains confident in the world's main (core) economy - the United States.

Gold, and likely not cyrptocurrencies, will rally sharply when confidence falters as the crisis continues to unfold and intensify. Hyperinflation, an over predicted symptom of failing domestic and international confidence, comes only after it falters to the point that periphery and core (economy) nations can no longer sell their debt; they hold auction but nobody shows up. After that, they have two choices - default or print money to finance their unsustainable standard of livings. Default is rarely the option of the choice.

Intermarket trends allow investors to define the direction and concentration of confidence. Smart recognizes faltering confidence as risk-on trends in precious metals and consumer expectations. The former are tracked in the Matrix for subscribers.

Gold to Silver Ratio, one measure of risk-on and risk-off, is a proxy of confidence.

Chart


Intermarket capital flows have been antagonist towards gold for several months. Still bullish?

Headline: Gold steadies ahead of Fed meeting as dollar sags

JOHANNESBURG (Reuters) - Gold prices traded near a one-month high on Tuesday as the dollar languished at a more than one-year low ahead of a Federal Reserve meeting that is expected to provide more clues on U.S. monetary policy.

The market is not expecting a rate increase to result from the Fed's two-day meeting starting on Tuesday but it is looking for hints on the timing and extent of future moves.

Spot gold eased 0.1 percent to $1,252.60 an ounce at 0916 GMT. The metal had touched $1,258.79 in the previous session, its highest since June 23.

U.S. gold futures climbed 0.1 percent to $1,257.


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Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.