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Yield curve relentlessly steepens, gold builds a handle

Commentaries & Views

Yield Curve steepens under inflationary pressure while Gold’s monthly chart patiently builds its Handle

Another week, another yield curve steepener and continuation of the trend that began in August, 2019.

yield curve

yield curve

Flipping to the bigger picture I added in SPX, Gold and the CRB commodity index for reference. With the levels of MMT TMM (total market manipulation) injected in the markets since Ben Bernanke cooked up the diabolical macro manipulation known as Operation Twist I can’t pretend to quant the past to the present…

yield curve

…but one observation above is that gold is in a giant and bullish Cup with the Handle-making as anticipated since the correction began from a higher high last summer, still in process.

Ref. a November post, Building Gold’s Handle

Here is the updated chart from that post. It always was going to be an extended grind to put in a proper Handle on this monthly chart. Gold is doing good work and it is doing it in a preferred (i.e. not Goldilocks) environment. Goldilocks is a product of a flattening yield curve’s boom, and a steepening yield curve is either inflationary bullish or deflationary bearish. Or as per the last cycle, both.

This is definitely not Goldilocks, which not coincidently attended gold’s bear market every step of the way.

gold

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.