Gold’s Midnight Madness

Gold glittered and rocketed in Sunday trading, only to come back down to Earth [The Rude Awakening] December 04, 2023 [WEBSITE]( | [UNSUBSCRIBE]( Gold’s Midnight Madness [Sean Ring] SEAN RING I grabbed my iPhone to see what was happening as I got out of bed this morning. Boy, were the gold bugs excited! Of course, since we’ve been very bullish here at Paradigm Press, I got excited, too. It wouldn’t take months for gold to get above $2,100; it took mere days. Follow along with me. Last Night Into This Morning Before we start, if you notice different prices, you may have looked at gold futures instead of gold spot. A spot price is the price of the underlying commodity (in this case, an ounce of gold), excluding any transaction costs. A futures contract is the obligation (not a “right;” that’s an option) to buy or sell a specified quantity of a standardized asset (in this case, 100 ounces of gold) at a price agreed today (the futures price) for delivery in the future. Since the gold will be delivered in the future, the futures price includes the cost of carry, which includes storage, insurance, foregone interest, and the convenience yield. Essentially, the futures contract is the spot commodity moved through time. It’s not a prediction of where the price will be once the futures contract matures. Here’s the spot gold chart for this morning. [SJN - issue 12.04.23] Credit: [Kitco]( Let’s start with Friday’s light blue line. We saw nice price movement from about $2,040 to the close of $2,071. Then we go into Sunday’s market (the red line). This is where the Twitterverse exploded, along with the gold price. Spot gold spiked to nearly $2,140, a tremendous $100 move over little more than a day. But what goes up parabolically usually comes down as fast. And so it was with gold. Gold closed Sunday with only a $10 move up. Today, it opened at about $2,082 and is currently trading at about $2,070. In short, the entirety of the crazy spike was eliminated. [Biden Admin Furious Over This New “Alternative” Currency]( Take a close look at this photo: [What you see here is a new “alternative” currency that’s taking America by storm…]( One which could ruin Biden’s CBDC plans. It’s already popping across the nation… including Utah, New Hampshire and Nevada. [If you’re worried about Biden Bucks then you must watch this short 2-minute video that breaks down how this “alternative” currency works…]( [Click Here To Learn More]( Mr. Slammy Returns “Mr. Slammy” is the euphemism gold traders use for the entities that short gold futures when the price goes too high. When the price gets “monkey hammered” overnight, it’s usually Mr. Slammy, whoever he is, who does it. A high gold price isn’t good for the US, Let’s look at the consequences of high gold prices: For the United States - Inflation Indicator: A high gold price often signals high inflation, harming the economy. Gold is traditionally seen as a safe haven in times of economic uncertainty, and its rising price can indicate a lack of confidence in the stability of the current economic situation. - Currency Devaluation: Gold prices often move inversely to the U.S. dollar. So, when gold prices are high, it can suggest a weaker dollar, affecting the U.S.'s purchasing power and trade balance. - Impact on Interest Rates: The Federal Reserve might raise interest rates to combat inflation, slowing economic growth. Higher interest rates can make borrowing more expensive, affecting consumer spending and business investments. For "Enemies" or Rivals like Russia and China - Diversification Away from USD: Countries not allied with the U.S. might use gold to diversify their reserves away from the U.S. dollar. A high gold price benefits these countries as it increases the value of their gold reserves. - Economic Leverage: If a rival country is a significant producer of gold, high prices can boost its export revenues, giving it more financial leverage. - Weakening US Influence: As gold prices rise and the dollar weakens, countries that rely less on the dollar for international trade can see a relative increase in their economic and geopolitical influence. Contextual Factors - U.S. Debt: The U.S. holds a large amount of debt. A weaker dollar (implied by high gold prices) can make servicing this debt more expensive. - Global Economic Conditions: The reasons behind the rise in gold prices matter. Due to global uncertainties, it could harm all economies, not just the U.S. - Market Dynamics: The rise in gold prices is sometimes driven more by market speculation than fundamental economic weaknesses. While high gold prices can signal challenges for the U.S. economy, particularly in terms of inflation and currency strength, the impact on its "enemies" depends on its economic structure, reliance on gold, and its relationship with the global financial system dominated by the U.S. dollar. To be sure, a lower gold price is good for the USG. And Let’s Not Forget Bitcoin [SJN-Issue-12-04-23] Bitcoin has moved from $25,000 to roughly $42,000 in the last three months. It’s an incredible haul by any standard. For you math geeks out there, that’s a 68% holding period return over three months. Wow. Safe Haven Assets What gold’s and Bitcoin’s moves say to me is the world is searching for a safe haven away from government-induced inflation (fiscal policy) or central bank-induced inflation (monetary policy). With Powell tightening the way he did, the blame for high inflation is on the government or whoever controls The Bot Known As Joe Biden. Wrap Up There were some delighted gold traders overnight, but eventually, they went to sleep disappointed. While gold hit $2,170 overnight, it’s below Friday’s close. Bitcoin has been rallying furiously over the past three months. Silver also opened up intensely and then sunk below Friday’s lows. The fight between inflation fighters and Mr. Slammy has entered a new phase. All the best, [Sean Ring] Sean Ring Editor, Rude Awakening X (formerly Twitter): [@seaniechaos]( In Case You Missed It… Gold Closes Above $2,000: November 2023 MACR [Sean Ring] SEAN RING Happy Friday, indeed! First, Kissinger snuffed it. Then gold closed above $2,000 for the first time yesterday evening. I can’t tell you how excited I am. But we must temper our excitement with good sense. Tom Luongo, the editor of the [Gold, Goats, ‘n Guns]( report, retweeted a vital talk from VBL’s Ghost: [Rude awakening] Credit: [@TFL1728]( I urge you to listen to both parts of that talk. (You’ll find the second part in the thread.) The upshot is that TPTB will still monkeyhammer gold whenever they can. “They” just can’t hold the $2,000 line anymore. Though that notion pisses on my parade somewhat, it’s absolutely correct. Let’s get long but not euphoric. So, while gold will breach the $3,000, it may take much longer than my visibly excited self would like it to. Let’s get to the rest of the charts. S&P 500 [The Rude awakening] What a month SPX has had! After a big rally from the early days of November, SPX closed the month at 4,567.80. Depending on where the market decides to rest, the next target is 4,800 for a long, soft target of 5,399. Nasdaq Composite [The Rude awakening] Much the same as the SPX. Looking now to 14,400. Above, there is the 16,000 level. Russell 2000 (Small caps) [The Rude awakening] The Russell broke back up like the majors. First, I’m looking for the 197 level, then the 205 level. The US 10-Year Yield [The Rude awakening] Jay Powell has well and truly pivoted. But he doesn’t control the long end of the yield curve. This is the market telling him the games are over. It went back to 3.5% in no time at all. Dollar Index [The Rude awakening] The Powell Pivot changed the game. How can you be a bull with EUR, GBP, and JPY taking up 81% of this basket? Just wait until he starts cutting… USG Bonds [The Rude awakening] We were close to the 80 target but won’t hit it now. Suddenly, bonds look attractive. The first level to look for is 95. Then 100. The big target is 110. Investment Grade Bonds [The Rude awakening] I got caught on a false downside breakout. After the big rebound, we’re now looking at the 109 level first. The final target, for now, is 134. High Yield Bonds [The Rude awakening] Again, I got caught on the Powell pivot. The next big target is 78. The ultimate destination is 88. Real Estate [The Rude awakening] Instead of continuing down, we reversed. Look for the 90-92 levels from here. [[A.I. Supplier]: $100 Billion Sales Surge Coming?…]( Nvidia’s little-known supplier is set for a [$100 BILLLION sales explosion]( …and it’s thanks in part to this mysterious device you see here: According to our research… This $100 billion sales boom could even turn this little-known supplier… …into the [the next trillion-dollar stock](. To see how to take advantage of this little-known supplier – before it’s $100 billion sales surge —— [go here now.]( [Click Here To Learn More]( Energy: West Texas Intermediate (Oil) [The Rude awakening] Oil may be turning around from here. I suppose we didn’t get to 73… 75 is near enough. Now I’m looking up to 90. Base Metals: Copper [The Rude awakening] Though copper rallied, I’m not convinced. I am still keeping my downside targets of 3.60 and 3.30. The real economy is in bad shape. Precious Metals: Gold [The Rude awakening] Ok, we finally closed a month above $2,000. Allegedly, the sky’s the limit. But, we need to be cautiously optimistic. The new upside target in gold is $2,340. In my interview with Thorsten Polleit, he targeted $2,200 for year-end. Both can be correct. But we must see the new “line in the sand” to make more valid assumptions. Good hunting! Precious Metals: Silver [The Rude awakening] As Rick Rule says, fear drives gold. But once a gold rally is established, silver joins in as a greed trade. The upside target here is only $26.50. For now. Let gold get a head of steam going, and then silver will follow. It’ll take all your patience, but it’ll be worth it. Cryptos: Bitcoin [The Rude awakening] Ran straight through my target of $35,650. Next target: $47,000 or thereabouts. Cryptos: Ether [The Rude awakening] Nearly $2,100 now. I am looking for $2,300 on the upside. Trad Asset Class Summary [The Rude awakening] Now that the market thinks Jay Powell is finished hiking, the USD took a breather. As a result, stocks and bonds rebounded after a few down months. Oddly, though, commodities didn’t rally. That leads me to think the recession is already hurting the economy. Crypto Class Summary [The Rude awakening] Dogecoin, Ether, and Bitcoin led the way, while Bitcoin Cash (a fork - derivative - of Bitcoin) was the big loser. Ripple, Litecoin, and Monero were all relatively flat. Wrap Up Gold is the big story today. Silver will be the big story tomorrow. Crypto is a big story for the ages. Stocks and bonds are up as well. Just wait until Powell actually starts cutting rates! Finally, let’s take a moment, courtesy of the Twitterverse: [The Rude awakening] Have a wonderful weekend! All the best, [Sean Ring] Sean Ring Editor, Rude Awakening Twitter: [@seaniechaos]( [Paradigm]( ☰ ⊗ [ARCHIVE]( [ABOUT]( [Contact Us]( © 2023 Paradigm Press, LLC. 808 Saint Paul Street, Baltimore MD 21202. By submitting your email address, you consent to Paradigm Press, LLC. delivering daily email issues and advertisements. 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