Gold Versus The Yen Stewart Thomson
Aug 15, 2017
- For gold to perform well against the US dollar, it needs to perform well against the Japanese yen.
- Please click here now. Double-click to enlarge.
- Since 2011 gold has traded sideways against the yen. Since 2013 it has been coiling in a very positive symmetrical triangle pattern.
- An upside breakout would usher in a major move higher for gold against both the yen and the dollar.
- Since 2013, the Indian market has been dealing with major duty, import rule, and hallmarking issues. The process has weighed on demand since 2012.
- India’s gold market has undergone an enormous restructuring in response to these issues. The good news is that the restructuring is essentially complete now.
- That paves the way for higher imports on a much more consistent basis.
- China has made significant progress in tying gold price discovery more to physical demand versus supply.
- Trump has also had major success in pushing the dollar lower against most of the world’s currencies.
- These are not just one-time events. Events like tension in Korea can move gold $20 - $50 in a short period of time. A $100 - $200 move is possible if the tension intensifies (which it hasn’t).
- Unfortunately, these gains are no more sustainable than the gains from the 1980 Russian invasion of Afghanistan were sustainable.
- When the tension subsides, all the gains from these one-time events tends to be lost.
- To move $1000 higher or more, gold needs to see a quasi-permanent ramp-up in the physical market demand against static or limited supply growth, and that’s happening right here, right now.
- Trump’s actions on the dollar are a long-term process. He is now beginning a trade war with China. From a gold price discovery perspective, this is vastly more important than tension involving Korea.
- Please click here now. Double-click to enlarge this gold chart.
- Gold looks fabulous. After rallying about $90, gold is consolidating its gains. A new minor support zone at $1260 - $1280 is in play. Both traders and accumulators can be buyers in this support zone, in anticipation of a sustained rise above $1300.
- Please click here now. Double-click to enlarge this daily chart of the Dow. If the US stock market suffers a major crash in September or October, there tend to be “cracks in the dike” in August.
- That’s what’s happening now. The uptrend is still intact, but getting tested. The next technical event to watch for is an RSI non-confirmation. This happens when the Dow makes a new high, but the RSI oscillator (shown at the top of the chart) does not.
- Investors can lighten up in August and essentially take a two month stock market holiday. That’s what I do. It reduces emotional stress.
- My focus is more on the Asian stock markets than America, and I’ve sold about 30% of my positions into this price strength. If there is a crash, investors can buy aggressively, with a focus on banks and Asian markets.
- Asian consumers carry debt that is similar to US citizen debt, but they have a lot of savings and strong saving rates as a percentage of income. US citizens have almost no savings and abysmal saving rates.
- Asian markets will rebound from any crash with the resiliency shown by US markets during the late 1800s. In contrast, US markets are in danger of descending into a stagflationary gulag if they crash. I’m a buyer of US markets if they crash, but not with much risk capital compared to my Asian market allocation.
- Please click here now. A number of influential money managers are following GDX right now, including Jeff Gundlach. The triangle formation they are following is important, but what is more exciting is the bullish volume action.
- Volume is rising on rallies within the triangle, and ebbing on declines. That’s very positive. Bullion and mining stock investors should be very comfortable right now. Technical breakouts appear imminent and fundamentals are strong!
Apr 15, 2017
email for questions: firstname.lastname@example.org
email to request the free reports: email@example.com
|Tuesday 12th Dec 2017
Special Offer for 321Gold readers: Send an email to firstname.lastname@example.org and I'll send you my free “New Golden Kids On The Block!” report. I highlight key “under the radar” junior gold and silver stocks that seem ready to stage 50% - 100% rallies during Chinese New Year. Potentially large profits can then be booked before they swoon in February. I include key buy and sell action points for each stock.
Updates Subscription Service: Note we are privacy oriented. We accept cheques.
And credit cards thru PayPal only on our website. For your protection
we don't see your credit card information. Only PayPal
|Subscribe via major credit cards
- or make checks payable to: "Stewart Thomson" Mail
to: Stewart Thomson / 1276 Lakeview Drive / Oakville, Ontario
L6H 2M8 / Canada
is a retired Merrill Lynch broker. Stewart writes the Graceland
Updates daily between 4am-7am. They are sent out around 8am. The
newsletter is attractively priced and the format is a unique numbered
point form; giving clarity to each point and saving valuable
Thomson is no longer an investment advisor. The information provided
by Stewart and Graceland Updates is for general information purposes
only. Before taking any action on any investment, it is imperative
that you consult with multiple properly licensed, experienced
and qualifed investment advisors and get numerous opinions before
taking any action. Your minimum risk on any investment in the
world is 100% loss of all your money. You may be taking
or preparing to take leveraged positions in investments and not
know it, exposing yourself to unlimited risks. This is highly
concerning if you are an investor in any derivatives products.
There is an approx $700 trillion OTC Derivatives Iceberg with
a tiny portion written off officially. The bottom line: