Will Gold Prices Rise After the Brexit?
- Author: Jack Mann Jun 18, 2016,
Jun 18, 2016, 8:49
Gold rallied to $1296.77 after the Fed completed its meeting, and announced its plan to set fewer rate hikes for each year.
Less than two weeks ago, Fed watchers had seen a chance for a rate hike at this meeting, but the 38,000 nonfarm payrolls in the May jobs report were about 100,000 below some of the lowest forecasts.
It is also worth pointing out that Bitcoin made a new 2-year high above $750 this morning as well.
NEW YORK/LONDON Gold rose more than 1 percent on Friday, supported by a softer dollar and cautious interest rate comments by a voting U.S. Federal Reserve policy member, and was headed for a third week of gains. It is de-centralized, limited in quantity and outside of government/central bank control.
While gold has been up the last five trading sessions, it still faces enormous risk.
And will the Fed have anything to say about the recent plunge in overseas and USA bond yields, which many analysts say reflect a "fear trade" ahead of next week's scheduled "Brexit" referendum in which British voters will decide whether or not to stay in the European Union?
USA gold for August delivery was down 0.2 percent at $1,295.50 an ounce. One such risk occurred on Thursday when Gold retreated, after hitting above the $1300 level. But relief will be short-lived if the U.S. employment data doesn't stabilize and the Fed shifts back to a more hawkish stance.but feedback loops between the Fed and markets persist We have argued that feedback loops between equities and the Fed are key for market dynamics, and below we extend our work to a more robust framework.
The Fed didn't just announce how many rate hikes it would have for this year alone.
Shortly after United Kingdom market close, gold was down US$3 to US$1,283, silver gained 8c to trade at US$17.45, and platinum was also up US$2 to US$975. People keep falling for this FED trick by panicking out of their PM positions and you can step up and purchase their metals or shares at a nice discount.
United States 10-year yield down 3.6 bps to 1.58%.
Moreover, the Federal Open Market Committee left fed funds rate unchanged in a 0.25-0.50% range, in line with market expectations. He launched Gold Stock Bull in 2005 and turned his focus from helping fortune 500 companies to helping individual investors that were struggling to achieve strong gains in the stock market. Indeed this week saw price reverse sharply off the moving average, posting an outside-day reversal candle off resistance.
For example, our top silver stock pick is up 270% this year.
The pound gained the most in a week, climbing 0.4 per cent to $US1.4181, as data showed an unexpected acceleration in United Kingdom wage growth and the unemployment rate fell to a 5 per cent, the lowest since 2005. In my view, the upside potential dwarfs the downside risk, even after the huge move this year.
Jason Hamlin is the founder of Gold Stock Bull and has been investing in precious metals for over 20 years. The information on this site has been prepared without regard to any particular investor's investment objectives, financial situation, and needs. Past performance is no guarantee of future results.