Trump Bomb Boosts Gold

Gold’s getting a boost from the turmoil in Donald Trump’s West Wing. The haven rose for a fifth day as the president’s latest controversy prompted references to the 1970s Watergate scandal that helped to sink predecessor Richard Nixon, hurting the dollar as investors cut back on risk.

The president “perhaps is facing his toughest time in the office,” said Naeem Aslam, chief market analyst in London at Think Markets U.K. Ltd. Investors are questioning whether there is “any possibility of impeachment becoming a reality, because certainly that would hit the confidence massively.”

Bullion for immediate delivery climbed as much as 0.6 percent to $1,245.07 an ounce, the highest since May 3, and was at $1,243.78 at 9:41 a.m. in London, according to Bloomberg generic pricing, as the Bloomberg Dollar Spot Index sank to the lowest since November. The precious metal’s winning run is the longest such stretch in a month, and takes gains this year to 8.4 percent.

Gold has risen after Trump’s firing of FBI Director James Comey a week ago, and following reports he shared intelligence with Russia. In the latest twist Trump is said to have asked Comey in February to drop an investigation into a former national security adviser, raising questions that he may have obstructed justice. The problems are seen as drawing the administration’s focus away from policies to aid growth, and have spurred recollections of former President Nixon, who was ensnared in Watergate and resigned.

“It’s a political dogfight,” Ole Hansen, head of commodities strategy at Saxo Bank A/S in Copenhagen, said by phone. “That does mean that his ability to act as a president, and to do what he’s promised, is sharply reduced and in that lies the risk of dollar weakness.”

Democrats say reports Trump asked Comey to drop the investigation into Michael Flynn amount to obstruction of justice, if true. “I hope you can let this go,” Trump told the FBI director, according to a Comey memo, as cited by the New York Times. The White House has denied that version of events.

‘Ability to Deliver’

On Trump’s position and the Comey fallout, “it’s much too early to say,” Hansen said, when asked whether the current situation is reminiscent of the Watergate era. “I don’t think the sum of that adds up to something that could potentially lead to the removal. But what it does do, is really just is bucking down the White House and the ability to deliver on promises.”

The concerns surrounding the White House may slow economic policy decisions, according to Westpac Banking Corp., which recommends investors short the dollar. “Regardless of the ultimate conclusion of the political storm over Trump’s actions on Russia and the security services, it will at the very least linger as a distraction that makes it more difficult for the White House to pass pro-growth policies,” said Sean Callow, a senior currency strategist.

“The rise in gold is largely a dollar play, with the dollar weakening because of Trump,” said Barnabas Gan, an economist at Oversea-Chinese Banking Corp., who also flagged overseas tensions. “There’s still more downside risk to gold in the long run, but in the short-term, given what the North Koreans are doing and what Trump is doing, the dollar is inherently weak.”

Bullion has advanced in 2017 — posting a run of four monthly gains through April — even as the Federal Reserve tightens monetary policy, with a rate rise in March and more increases likely to follow. Higher rates tend to curb the appeal of non-interest-bearing assets like gold.

While this year is a “pretty hazy year for bullion, the path of least resistance is on the bearish side,” said Singapore-based Gan, highlighting the Fed’s tightening cycle. “If we divorce away all the uncertainty, the rate-hike story should at least bring gold prices to $1,100.”

Cheerio.

The Pinstripe and Bowler Club shares information with MF Solutions Ltd.

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Gold Rising

Gold has traded in a range since the end of March, but Todd Gordon sees a rise in market volatility coming that could send the yellow metal higher.

The trader commented Thursday that recent comments by the Federal Reserve could spell more uncertainty in the market. Potential rate hikes aside, Fed minutes released on Wednesday from the March meeting stated its intent to start shrinking its $4.5 trillion balance sheet later this year.

“We’re seeing some volatility in the markets,” said Gordon. “I actually want to look at the gold market, which could be moving up here” off the uncertainty that could result from the Fed.

To determine just how high gold could climb, Gordon looked at a long-term chart of GLD, the ETF that tracks gold, dating back multiple years. According to Gordon, a “triple-test trendline” can be drawn on GLD starting from its peak back in 2012, with the line finishing just above current levels in GLD at the $123 to $125 mark. This leads Gordon to believe that should GLD bounce, it can hit the trendline again at around those levels.

“There are a couple sources of volatility and concern in the markets,” explained Gordon. “I think that’s going to be enough to punch the market through resistance to test that long-term downtrend from 2012.”

Cheerio.

The Pinstripe and Bowler Club shares information with MF Solutions Ltd.

Gold Rise To Continue

“Don’t gain the world and lose your soul; wisdom is better than silver or gold.”

You may have to read the quote more than once, but Bob Marley knew what he was talking about.

At the moment, investors seemingly disagree a bit with him, and they have pushed spot gold up around 8 percent higher since the beginning of the year.

The lack of wisdom from everyone with the desire to hurt others has meant the safe-haven trade has found a new pocket of geopolitical opportunity.

Nobody sane wants more people to die in Syria, and nobody sane wants to start a war with North Korea, but how to handle both these hotspots is easier said than done, and this is proving the case with the new U.S. administration, just as it was the old.

The potential for deflation is a thing of the good old days (like 2016), but even with inflation gods sprinkling inflation dust, gold as an inflation hedge is not the only reason to buy the metal.

Kieron Hodgson, a commodity and mining analyst from Panmure Gordon & Co, says that despite having a bullish outlook for the  USD, all other factors are in place to push the spot gold price higher.

He lists economic uncertainty (Brexit, French elections, Chinese debt levels), concerns over high equity valuations (the U.K. now has all 10 industry groups returning positive 5-year rolling performances for the first time), trading positions (short positions were peaked around the recent U.S. rate decision and then collapsed when the conversation switched to deleveraging the Fed’s balance sheet), central banks (they are now marginal buyers of gold for the first time since 2012) and indeed the pickup in inflation as being the main issues that should continue to support the price of gold.

Hodgson says that the long term trend of lower gold prices that has been in place since 2011, will come to an end due to gathering risks, which could impact record high equity markets and lead to a correction.

Panmure Gordon isn’t waiting, and has upgraded its gold price forecast to $1,300 per ounce (from $1,225 per ounce) for 2017.

For 2018, they also see a rise to $1,350 per ounce (from $1,200 per ounce).

Cheerio.

The Pinstripe and Bowler Club shares information with MF Solutions Ltd.

Buy Gold

Gold posted a breakout session Tuesday as investors took risk positions off the table as geopolitical tensions rose.

Futures on the precious metal jumped 1.6 percent during the regular session, bringing their year-to-date gain to above 10 percent. The metal kept going higher in after-hours trading with the futures reaching an intraday high of 1,277.40, which was their highest level since Nov. 10.

Gold futures also surpassed their average price of the last 200 days, a common measure used by technical analysts to determine a trend.

Short and sweet today, buy gold.

Cheerio.

The Pinstripe and Bowler Club shares information with MF Solutions Ltd.

No End To The Love Of A Nugget

A partnership between Randgold, AngloGold Ashanti Ltd. and state-owned Sokimo, Kibali shipped 642,720 ounces of gold worth more than $700 million in 2015. That helped increase production of the precious metal in the country from almost nothing in 2011 to more than 25 tons a year.

Production last year fell to 585,946 ounces after technical challenges in the first six months, but output is scheduled to peak at 750,000 ounces in 2018 as the underground operation reaches full capacity, Randgold says.

Other miners have been less successful in Congo. Randgold’s partner, AngloGold, suspended operations in 2013 at the Mongbwalu project, also in northeastern Congo, saying that it couldn’t make the economics of the project work. In the past decade, mining majors Rio Tinto Group, BHP Billiton Plc, Vale SA and De Beers have all held and abandoned mining licenses in Congo for different minerals without making headway.

In short, gold has been in demand for thousands of years, is in huge demand right now and gold has a massive future because everybody loves gold.

Cheerio.

The Pinstripe and Bowler Club shares information with MF Solutions Ltd.

 

Raw Info

Let’s start with the basic truth that raw materials are cyclical and can be very profitable.

The cycles can be extreme, and we’ve lived through many of them. Cycles go with the territory, and investors keep trying to make money with them because they can be so enormously profitable on the way back up.

It’s not easy getting the hang of them, and one gets better over the years. But it’s a challenge because the Mass Psychology is so treacherous that people overstay their visits and get stuck riding them back down.

The good thing is wealth in the ground always lasts, even though profits from them are cyclical. I think this cycle of the commodity bear market is over. So I’m optimistic.

Within the vast field of raw materials there are specific islands that tend to move together, such as gold, silver, palladium and platinum.

One of our pioneering Mass Psychological concepts is the Wolfpack Theory , so that you could make money by getting one or two right and can then home in on the other two of the four. For example, gold and silver are up so palladium and platinum should soon rise also. Uranium is also cyclical as well as cannabis.

How we can make some money on these? Talk to the guys at MF Solutions.

Cheerio

The Pinstripe and Bowler Club share information with MF Solutions Ltd.

Golden Book

Precious metals expert Mr. James Dines believes we’re on the verge of an historic rally in gold prices…

He’s also the author of the bestselling book Goldbug!, which is widely considered to be the “bible” of gold and silver investing.

In it, you’ll see why Mr. Dines thinks:

  • Gold is going to $5,000 an ounce
  • Silver is going to $300 an ounce
  • The shocking reason silver’s price could exceed the price of gold, which will happen near their final peaks

Cheerio

The Pinstripe and Bowler Club share information with MF Solutions Ltd.