After breaking upside from a double bottom pattern, gold continues its solid price action. More good times lie directly ahead for precious metals investors, because Chinese New Year buy season begins very soon.
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Note the solid position of my key 14,7,7 Stochastics indicator on this daily gold chart.
The US stock market’s “traditional end of the year rally” is turning into a veritable turkey shoot for the bears. Gold seems immune to the action, suggesting that unseen inflationary pressures may be larger than most investors realize.
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Investors need to understand that as the business cycle matures, volatility in the stock market rises.
Any decline could be the start of a bear market. A “buy the dip” approach to the market becomes a death trap as corporate earnings peak, rates rise, GDP peaks and inflation gains attention.
The bottom line: US stock market bears crack the whip, and late cycle price chasers take a horrific trip!
Morgan Stanley’s top currency analysts believe the dollar has peaked against most of the currencies it recently rallied against. Hedge fund “superman” Ray Dalio is talking about a 30% dollar devaluation. He proposes monetizing the US government’s huge debt as a “final solution”.
I’ve suggested a “Plaza Accord 2.0” is going to happen. I believe President Trump will lead preliminary discussions about it from behind closed doors at the upcoming G20 meeting.
As empires peak and then die, the peak usually comes with the nation enveloped in a state of “war worship”.
Massive amounts of money are borrowed by the government to fund the madness, but even that isn’t so enough, so more is extorted via “taxes” from struggling citizens.
In the case of America, more than 25% of the government’s gargantuan debt is easily attributable to war worship.
