Gold Surges To 18 Month Highs : US Dollar Continues Decline

Gold Bugs are rejoicing as we close in on the Brexit High of July 2016. A lot has been written recently about Gold being just a "Pet Rock" and a "Relic of History" but it continues to defy Central Banker and Crypto Zealot down ramping attempts. It is proving it still is a good store of wealth and has an important role to play as an alternative to Inflationary Fiat Currencies and Volatile Crypto Currencies.

The recent rally in Gold is now into its 7th week and it has been strong enough to convince me that we will break the Brexit high and maybe even take out the high of March 2014 to give us the strongest Gold price in about 5 years. This rally is not quite as spectacular as the Crypto market has been of late, but for our old-world financial system, Gold taking out these highs will be significant.

“Why is Gold doing so well?” You ask. Well there are a number of reasons. If you want a bit of a refresher, have a read of my post about the 3 Traditional Gold Price Drivers for some background context. There is obviously ongoing uncertainty around the Trump Presidency, plus we have wavering sentiment in the Crypto Markets, but the main driver seems to be the ongoing decline of the US Dollar. If we have a look at the US Dollar Index (a measure of US Dollar worth) we can see it’s been on the slide for about a year and has just made a new low. This correlates to the fresh rally in Gold and indicates investors are losing faith in the world Reserve Currency (the US Dollar) and are looking for alternative ways to store value. Traditionally this alternative has been Gold.

The most recent sharp dip in the US Dollar (and correlated sharp rally in Gold) has been attributed to the US Treasury Secretary Steven Mnuchin who was seen as advocating that "…a weaker dollar is good for us as it relates to trade and opportunities" while speaking at the World Economic Forum in Davos Switzerland. For those who aren’t aware, this is the big forum every year where the elite Banksters from around the world get together to consipire plan the global economy for the good of us all.

According to THIS ARTICLE this year they seem to be more worried about Cryptos than Gold so maybe they are taking their eye off the ball. I think these old dinosaurs are slowly starting to realise they are losing control of the financial world and their monopolies are under threat.