I last posted about Gold two weeks ago,
Goldman Sachs Group Inc. is leading a pack of bullish voices cheering for gold. The bank’s analysts led by Jeffrey Currie raised their price forecast for gold, predicting that over 12 months the metal will climb to $1,425 an ounce -- a level not seen in more than five years.
Gold had an amazing day, increasing a little over $18 on Friday. Gold finished the day above $1,300 again at the highest since June. As you know, Gold is a safe haven, so the recent shutdown issues in Washington, the issues in the Eurozone and most recently, issues in Venezuela (countries in the Eurzone have given Venezuelan's leader Nicolas Maduro an ultimatum, saying the nations would recognize opposition leader Juan Guaido as president unless he calls elections within eight days).
However, I think the real move up behind gold was the US dollar going down. U.S. dollar went down ahead of next week’s FOMC meeting. The expectation is that the Feds will not raise interest rates. But in general gold and the US dollar are inverse correlated as shown in the chart below. The chart is showing that gold is strengthening, while the US dollar is weakening.
I marked "Dec" on the chart because at the beginning of December I wrote a post about the bottom in gold.
So after basing for the last three weeks, gold finally broke out and closed above the pivot high. Next stop $1330...but this is only the 1st stop.
This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.