Gold Holding Tight
Gold has “shrugged off” two bearish developments, a strong dollar and weaker commodity
1)---The DOLLAR GREEN BACK—The Dollar is the world currency and is ready to break down due to the word R— recession… Geopolitical uncertainty, slower global growth, the appreciating dollar, declining oil prices, and tighter financial conditions remain the key risks…All eyes get ready for the last week in January …
www.rbc.com/economics/economic-data-calendars/us/ustable.pdf
2 )--Ratio of oil to gold is at an extreme levels. It has never been so expensive. Not in the ‘70s, not in the ‘80s, not in the ‘90s or ‘00s. …The ratio should be the price of 17 barrels times the price of oil gives you the price of Gold Take a look
17 barrels TIMES-- lets use $30.00 price per barrel----17 * 30 = $510.00 but Gold trading at $1,100
That’s 36 barrels X $30=$1,080 GOLD AT extreme levels and holding .
Bad news Gold could see a decline to normal levels $900 based on the gold to oil ratio…In a normal market that is..
Good news and it’s a dirty word Politics any lost confidence in the FED or Governments Then the crisis hits, that’s when normal people pile into gold and the price goes parabolic.
So place your bets and may the best hand win …unless you have a ace up your sleeve ..or QE to infinity