It looks like Gold is having another go at breaking above that elusive $1000 level! We think that this time around it will move “over the top” Goodness knows how far it will move once it clears $1000! What makes us think that Gold is about to break out? Well apart from the gold price it is the strength of:
- Silver, we would not take gold’s strength too seriously unless there was associated strength in silver (and of course vice versa),
- Base metals, strength copper helps because silver should follow what copper and nickel does (silver is also a base metal),
- Gold miners, at least that is a confirming factor,
- US Treasuries, usually gold goes up when US treasuries go down but gold and silver have been going up when US treasuries have been strengthening. The question is what will happen to G & S when treasuries go down (which we expect),
- Aussie Dollars, the Aussie has been unmoved by the recent weakness in equities and we find that currency markets are more efficient than commodity markets (i.e. commodity currencies are leading indicators for commodities themselves).
So we wait with crossed fingers……..everything seems to be falling into place!
Our wealth creation portfolio is up 14.6% since the beginning of the year with approximately 40% of the volatility of the S&P 500. This portfolio is not leveraged.
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