What is our trading focus?
XAUUSD - Spot gold
XAGUSD - Spot silver
XAUXAG - Gold-Silver ratio
GLD:arcx - SPDR Gold Shares ETF
GDX:arcx - VanEck Gold Miners ETF
CNBC interview discussing the latest gold developments
Spot gold has broken above $1800/oz thereby succeeding what it failed to do on two previous occasions, most recently in 2012. With silver at the same time breaking resistance at $18.40/oz the path towards higher prices have now opened up. The break could now signal an extension for gold towards the 2011 record high at $1920/oz while silver could take aim at the next level of resistance just below $19/oz followed by $19.65/oz.
NOTE: The intense focus on $1800/oz in gold in recent weeks may risk triggering some exhaustion in the market. The anticipated break and overriding bullish market sentiment may have already attracted an army of short-term tactical long positions. If the break, measured on today's closing price, fails to attract fresh momentum buying we may see some profit taking emerge. Overall however we see no reason why additional gains can not be achieved over the coming weeks and months. But an interesting day lies ahead no doubt.
The single biggest input that has driven the latest move higher has been the recent developments in U.S. yields. While the yield on ten-year notes remain anchored in a relative tight range, we have seen breakeven yields, an expression of inflation, move higher leading to a drop in real yields to the current -0.8%. These developments basically highlight what a U.S. market with yield-curve control would look like into a rising inflation scenario.