iGold

We are starting to get a stronger sense of what will be causing 2020’s advance in gold and silver: weakness in the US dollar and a concurrent inflationary spike in the entire commodity sector.

Gold and silver sometimes act on their own, independent of what is happening to the broader commodity world. However, at other points gold and silver will get pulled together with the rest of the resource sector – this is what is about to occur in the precious metals world.

The market does not need the Fed to intervene in the repo market, nor in any market for that matter. If lending in the repo market has gotten tight, there is a reason for that: lenders are cautious due to dubious fundamentals within the wider economy. The idea that the Fed should act to supersede the independent decision-making of individual institutions involved in the repo market is one that leads to a slippery slope of moral dilemma as problems grow larger and larger.

Not only did the Fed outline a new $425 billion “liquidity” program this week, it also promised to print more money by buying short-term US Treasury bonds if financing pressures required such. Fed Chairman Jerome Powell stated explicitly:

Click here to continue reading for FREE on our partner site, Gold Eagle…

Gold saw a huge sell-off last week: the precious metal was down by $49 or 3.2% to close at $1,463 as of the final trade on the New York COMEX on Friday afternoon.

During declines as we witnessed last week, it can be helpful to remember the big picture: gold broke out of a six-year basing pattern below $1,434 per ounce last August. After six years of grinding prices before then, it is unlikely that the final top is in yet after a single one-month surge above the resistance zone.

What we are witnessing now is a retest of the breakout. A retest is simply a term which describes behavior in which the market is literally asking former buyers: “Are you sure you meant to buy back then?”

Once the retest is complete, higher targets are expected:

Click here to continue reading for FREE on our partner site, Gold Eagle…

The precious metals are on the verge of flashing a signal that has only appeared three other times in the last twenty years. While the signal will be positive for all of the precious metals, it is silver that looks set to shine the brightest over the next several months.

Investors should carefully consider whether they have a proper allocation to the silver sector at this time.

Continue reading for FREE on our partner site, Silver Phoenix…