Gold/Silver: The ultimate reserve currency
Kitco Commentaries | Opinions, Ideas and Markets Talk
Featuring views and opinions written by market professionals, not staff journalists.
The surge this week in gold and silver with gold reaching a new all-time high has made it appear that the Fed has little concern about the long term damage that it is creating at the expense of the U.S. Dollar. I found this latest Fed meeting particularly interesting that there was no mention of the U.S. Dollar as if they don't care about yours and mine purchasing power. I guess the old saying goes "out of sight, out of mind," and the Fed shows little concern about the imminent rising inflation on the heels of record debt accumulation, increasing geopolitical tensions, and uncertainty as to when a restart of the economy will get going.
With precious metals showing the sharpest capital inflows since the financial crisis, this strategy of holding a mix of gold and silver should help offset the debasement of the dollar over the foreseeable future. For those of you who have not seen a chart of the U.S. Dollar, this is a tradable futures contract listed on the ICE exchange. If you did not receive the new edition of our free "Gold Trends Macro Book," it has been updated with currency slides. This monthly updated booklet will provide you with all the quantitative analysis of the precious metals markets. You can request yours here: Free Gold Trends Macro Book.
Dollar Index Daily Chart
Daily Gold Chart
Because of the inverse correlation that we see between the U.S. Dollar and the gold market (-.97%), we can use any up day in the U.S. Dollar as possible entry points into building longterm positions in the gold market along with silver. Our view continues to strengthen with the next upside price objective on gold to be $2500/oz. and silver at $30/oz. We have been extensively covering the technical backdrop of the gold market in the Blue Line Futures Morning Express Research Reports so be sure to stay up to date on the developments by registering for a Free two-week trial by clicking on the link here: The Blue Line Express Two-Week Free Trial Sign up