Gold Down... But Not Out

Brien Lundin Brien Lundin

Brien Lundin

December 11th, 2023 Comments

The correction from gold’s recent record-breaking price spike has been largely as expected.

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But what isn’t widely expected are the irresistible factors that will soon drive gold far, far higher.

It hasn’t been easy watching the price of gold an ounce drop precipitously from its recent, record-breaking heights.

Even though a correction wasn’t surprising, and in fact was widely predicted, it’s still hard to see so much red on the screen where there had been so much green.

In fact, gold’s down another $20 today as Treasury yields are up along with the Dollar Index.

The chart below shows the dynamics of today’s market, and how rising yields have driven gold lower.

US 10 Year Treasury Yield vs Gold Continuous Contract Chart

But even this short-term action is evidence of deeper trends in play. In particular, today’s auction of 10-year notes was met with tepid demand as investors demanded higher yields for the perceived risk.

This is just one of the bigger macro issues that will drive the markets, and gold, over the next few weeks and months.

In the weeks just ahead, the debt of both corporate borrowers and sovereign nations will be reset from ultra-low interest rates to today’s far higher levels...and this alone, if nothing else, will force the Fed and other central banks to begin cutting rates.

That will send gold and equities soaring. It’s why gold spiked to an all-time high just on speculation of a Fed pivot next year.

Brien Lundin

About the Author:

Brien Lundin is the publisher and editor of Gold Newsletter, the publication that has been the cornerstone of precious metals advisories since 1971.  Mr. Lundin covers not only resource stocks but also the entire world of investing. He also hosts the annual New Orleans Investment Conference. To get Brien Lundin’s ongoing commentary on the markets at no charge, click here to subscribe to his free Golden Opportunities newsletter.