Most Popular
1. Dow Max Drawdown Bear Stock Market 2022 - Accumulating Deviations from the Highs - 21st Feb 22
2.Putin Starts WW3 in Ukraine, Will Use Tactical Nuclear Weapons, China Prepares Taiwan Blitzkrieg - 28th Feb 22
3.World War 3 Phase 1 - Putin WINS Ukraine War! - 25th Feb 22
4.INVESTORS SEDUCED by CNBC and the STOCK CHARTS COMPLETELY MISS the BIG PICTURE! - 10th Feb 22
5.Will There Be A 2024 US Presidential Election? - 3rd Mar 22
6.Gold and SIlver, Precious Metals Sector Is at a Terrific Buy Spot - 6th Feb 22
7.Why Putin Wants the WHOLE of Ukraine - World War 3 Untended Consequences - 6th Feb 22
8.Dow Stock Market Expected Max Drawdown 2022 - 19th Feb 22
9.Stock Market Calm In the Eye of the Inflation Storm - 4th Mar 22
10.M = F - Everything is Waving! Stock Market Forward Guidance - 7th Mar 22
Last 7 days
Why Ray Dalio is WRONG About China - Principles for Dealing with the Changing World Order - 24th May 22
Globalists Convene to Plan Central Bank Digital Currencies - 24th May 22
After Recent Highs, What’s Next for the Gold Junior Miners? - 24th May 22
Why APPLE Could CRASH the Stock Market! - 21st May 22
Why Is Crude Oil Ignoring US Inventories? - 21st May 22
Here is Why I’m Still Bullish on Gold Mining Stocks - 21st May 22
THE INFLATION MEGA-TREND QE4EVER! - 20th May 22
US Real Estate Investors – Is There An End In Sight? - 20th May 22
How Technology Affected the Gaming Industry - 20th May 22
How To Set And Achieve Reasonable Goals For Your Company - 20th May 22
How Low Could the Amazon (AMZN) Stock Price Fall? - 19th May 22
Bitten by FANG? Clocked by Cryptos? -- 'Air Pockets' Everywhere - 19th May 22
Northern General Hospital Orthopedics Fractures and and Ankle Clinic Consultations Real Patient Experience - 19th May 22
Cathie Wood Goes All in on Teladoc, ARKK INSANE Noob Investing Strategy! - 17th May 22
This is Anything but Positive for US Housing Market - 17th May 22
What Should We Do If There Is No Fed Monetary Policy Pivot? - 17th May 22
All Possible Ways to Earn Free Litecoin - 17th May 22
How low Could the Amazon Stock Price Fall? - 16th May 22
Cathy Wood ARKK INSANITY There is NO Coming Back! - 16th May 22
NASDAQ 100 Stock Market LOWER LOWS & LOWER HIGH - 16th May 22
Sanctions, trade wars worsen US inflation - 16th May 22
AI Tech Stocks Earnings BloodBath Buying Opportunity - 14th May 22
Futures Contract – Trading Crude Oil With USO - 14th May 22
How to Get Kaspersky Internet Security for 80% Discount! Do not Pay Renewal Price! - 14th May 22
Sagittarius A* Super Massive Black Hole Monster at Centre of Our Galaxy REVEALED! - 14th May 22
UK Public Debt Smoking Inflation Gun - 13th May 22
What Happens When the Stock Market Dip Keeps Dipping? - 13th May 22
Biden Seeks Inflation Scapegoats; Gold Advocate Wins GOP Primary - 13th May 22
Apple and Microsoft Nuts Are About to CRACK and Send Stock Market Sharply Lower - 12th May 22
The War on Gold Ensures the Dollar’s Downfall - 12th May 22

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold Advanced During 2015 in Most Major Currencies

Commodities / Gold and Silver 2015 Jan 04, 2016 - 01:54 AM GMT

By: Jason_Hamlin

Commodities

Sentiment towards gold has been so bearish lately that you might think the yellow metal declined by 50% or more during 2015. In fact, it was only down 11% in U.S. dollar terms and gold actually advanced in most major currencies. Out of the 17 currencies tracked, gold was up in 10 of them and down in only 7 of them.

Gold advanced in both Canadian and Australian dollars, rocketed higher in Argentine pesos and Brazilian real, climbed higher in Mexican pesos, Russian Rubles, South African Rand, Turkish Lira and Ukrainian Hryvnia.


Some of the larger gains were driven by high inflation in each respective currency, but gold also advanced in currencies that were relatively stable during 2015. The biggest decline for gold came in U.S. dollars and Swiss francs, both down 11%. The next biggest loss was in Japanese yen, down 10% for the year.

The bottom line is that while most people price gold in dollars and therefore have a gloomy assessment of gold’s performance during 2015, it actually performed fairly well globally. It has been an effective inflation hedge in many of the countries where their currencies weakened during the year.

With gold’s biggest decline coming in U.S. dollars, this could be an excellent opportunity to buy gold with dollars during 2016. After a strong start to the year in 2015, the dollar effectively topped out and traded sideways for most of the year. The USD put in a double top during late November around the 100 level, the same resistance it faced in March.

There are some bullish factors that could propel the dollar higher in 2016. Rising interest rates should be bullish for the USD and if the stock market drops sharply as we anticipate, investors are likely to turn to dollars as a safe haven in the short term.

But one could argue that the dollar is currently overbought and the factors mentioned above have already been priced into the USD index. Eventually, I think people are going to realize that the dollar is not the safe haven that they believe it to be. There is an accelerating trend of de-dollarization around the globe, as a growing number of nations have opted to drop the dollar and use local currencies in trade. BRICS nations in particular are leading this charge and creating their own economic unions, collective banks and trade agreements to bypass the dollar.

Some believe that the dollar is the best of the fiat currencies, backed up by U.S. military might and willingness to enforce the petrodollar. But the U.S. is being challenged in the Middle East by an emergent Russia that will no longer allow the United States to dictate policy and dominate the energy trade.

And while the official debt-to-GDP ratio in the United States looks better than other nations, it does not factor in unfunded liabilities or the off-sheet derivatives time bomb that continues to tick. Eventually, I believe that investors around the globe will lose faith in the U.S. dollar and instead turn to precious metals or even Bitcoin as a preferred store of wealth during turbulent times.

While I can’t predict exactly when this will happen, I see this outcome as inevitable and a question of when, not if it will occur. In the meantime, I think the currently depressed prices for precious metals offer long-term investors an excellent opportunity to buy in tranches and continue stacking. Rising investment demand during 2015 suggests this is exactly what is occurring.

The gold chart for 2015 is undeniably bearish. The failure of support at $1,072 was significant and suggests more downside ahead. That being said, the price appears to be carving out a bottoming pattern and has bounced back above $1,072 several times since the support was initially breached. This gives some bullish color to our outlook on gold, especially if the price can climb back above $1,100 in the near term.

Get our insider trade alerts, monthly newsletter and model portfolio by becoming a Gold Stock Bull premium member.

By Jason Hamlin

http://www.goldstockbull.com/

Jason Hamlin is the founder of Gold Stock Bull and publishes a monthly contrarian newsletter that contains in-depth research into the markets with a focus on finding undervalued gold and silver mining companies. The Premium Membership includes the newsletter, real-time access to the model portfolio and email trade alerts whenever Jason is buying or selling. Click here for instant access!

Copyright © 2015 Gold Stock Bull - All Rights Reserved

All ideas, opinions, and/or forecasts, expressed or implied herein, are for informational purposes only and should not be construed as a recommendation to invest, trade, and/or speculate in the markets. Any investments, trades, and/or speculations made in light of the ideas, opinions, and/or forecasts, expressed or implied herein, are committed at your own risk, financial or otherwise. The information on this site has been prepared without regard to any particular investor’s investment objectives, financial situation, and needs. Accordingly, investors should not act on any information on this site without obtaining specific advice from their financial advisor. Past performance is no guarantee of future results.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in