Another nail in the coffin for deflationists! Gold traded at multi-week highs against paper currencies last night. Perhaps the most significant move was gold’s close above $AUD1180. The charts below suggest that something powerful is building in gold……perhaps something that will rival what we witnessed in the late 1980s. The evidence is there as plain as daylight for all to see, of course whether you choose to believe it or not is entirely up to you.
Now we wait on Crude and the CRB to breakout in Aussie dollar terms…..But given what has just happened with Gold (and what is happening with Baltic Freight rates, TIPs vs. US 10yrs we think Crude and the CRB will follow! Watch the CRB and Crude in Aussie Dollar terms. A break above 3.20 and 0.90 in the charts below will be the final nail in the coffin for deflationists!
This quote from Mark Twain applies equally to investing and economics as well. We say believe not in what others tell you but in what the market is telling you.
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