Monday, February 15, 2010
A new trend begins – Watch for confirmation of the breakout in gold
Gold Hits New Euro Record, Stock & Dollar Correlation "Still High", as Spain Joins Greece in Attacking "Speculators"
Gold, as I mentioned a few weeks back, is forming a massive cup and handle formation, confirming its breakout above $1000/ounce. It is now firmly on the way up again, and, the market is voting its verdict against the Euro, with money flooding into the Dollar. This is reminiscent of the period surrounding the world wars, when money see sawed between Europe and America, fleeing uncertainty. The trend is interesting, because, whilst some money is going into dollars, gold is rising against all currencies, signaling a systematic failure of fiat currencies. Spain and Greece are blaming speculators, but, whilst they are indeed drunk, who gave them the liquor? Central banks, flooding the market with liquidity and low rates plus governments legalizing fraudulent use of derivatives are at fault.