We’ve said it time and time again… FEAR and uncertainty make people and markets RUN to gold. While we don’t yet see people RUNNING… they are quickly walking to it. Add in some not so SUPER economic data and you have a strong short term future for gold. Take a look at the month chart below.
As tensions rise expect gold to do the same. In the event of an actual conflict… look for a small temporary BUBBLE. If a conflict does break out we expect gold to hit over $1400 pretty quickly. It’s really not SCIENCE… it’s just common sense. The stock markets will drop, gold will shoot up. We’ll have a “war” that lasts for fairly short time and things will start to normalize.
Stories are EVERYWHERE about this subject…
“Gold prices have rallied in the recent past on account of weak dollar and persistent political uncertainty from the US. Imposition of sanctions on Russia by the US and North Korea’s successful test of intercontinental ballistic missile fueled the rally further. The host of economic data sets released from the US starting from the GDP, which accelerated at the pace of 2.6 percent annual rate in the April-June quarter. The economy grew 1.9 percent in the first half of 2017, making it unlikely that GDP would top 2.5 percent for the full year. President Donald Trump has set an ambitious 3.0 percent growth target for 2017. However, slow wage growth and retreat in inflation appeared to weaken the case for the US FED to raise the interest rates again this year.
Gold futures settled firmly lower on Friday as the dollar jumped after a key report on payrolls in July showed stronger-than-expected job creation.
The U.S. labor market added an impressive 209,000 new jobs in July, more than most economists were banking on. The unemployment rate fell back to a 16-year low of 4.3%.
The data rallied stocks and the dollar index, dulling demand for gold, which tends to move inversely to the greenback.