Gold has decoupled from the dollar-driven dynamic evident over recent weeks. Traders' increasing awareness of improving US economic data and its subsequent implications for Federal Reserve monetary policy seem to be behind the divergence.
Some pundits are yelling for investors to take profits in junior resource stocks now. But the host of Ahead of the Herd online and editor of Ahead of the Herd newsletter, explains why $1,500 gold means investors should be cashing in, not cashing out.
Prices are testing the top of a rising channel that has confined trading for the past year, with the daily chart showing a bearish dark cloud cover candlestick pattern and hinting a move lower is ahead.
The key takeaway from was that the Fed is now unlikely to expand its quantitative easing program. In contrast to the statement that immediately followed the meeting, the minutes contained acknowledgement of constructive economic data.