Gold Market Wire
News, analysis and commentary for gold traders and investors
Gold Market Opening
Gold Slowly Stretches Out
May 20, 2020 - (Gold Market Wire) - Gold is starting the day feeling its way up the trend line as the chart formation continues to support higher prices. Right now, with the sustained crossing of the previous high of $1748.19, Gold is progressively building the platform for a sustained rally.
Gold is gaining strength through many forces, a primary one being the tentative moves within the EU for debt mutualization amongst member states. The idea of 500 billion euro system of grants, not loans, has many people speculating that the endless stream of money printing and bond buying by the ECB is gathering a new wind. That will do nothing but underpin the Gold rally. Where is all of this money coming from? How can governments issue still more debt in a zero percent interest rate environment? A true fin-de-siecle is in the making. It is dangerous territory and Gold is sniffing out that danger.
A larger force at work behind Gold's rise is the increasing public awareness that something was/is not right about what governments have been telling the public about Covid-19. Aside from doubts over statistical compilation of deaths, their methodology and implicit conclusions, the failure of large-scale fatalities to appear, based on the UK's Imperial College model (aka Ferguson model), the true reasoning behind the lockdown policy, looks like a debacle of the first order. Why was the entire world economy shut down when TB killed 1.5 million people last year and 600,000 people dies from malaria in 2017?The public is smelling deception at government hands. And regardless if that idea is right or wrong, Gold is reacting as it should.
To repeat: Gold responds with higher prices to the lack of public confidence in government. We are certainly in that state, and it does not appear that it is going to abate anytime soon.