GOLD (Prj.Y19.P2.E3).Sideways trading
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So why are stocks soaring? and how it will effect GOLD (on pause, go sideways)
For one thing, the Federal Reserve has cut interest rates to shore up the economy. Lower rates tend to push investors out of bonds and into stocks.
The Fed rate cuts have also given investors greater confidence that a recession is further away. Lower rates reduce borrowing costs for consumers and companies seeking loans to buy a house or car or to expand a business. They generally lead to more good things for the economy.
The central bank reduced rates mostly over worries that the U.S. trade war with China could endanger the economy, but tensions have eased as both countries returned to the bargaining table. That’s added to the confidence on Wall Street DJIA, +0.80% . SPX, +0.77%
Conclusion:
Funds are moved to where more gains will be made and hence Gold will remain as is, or sideways trading.
Those who have diversified their accounts have already done so and will not add more Gold unless the Stocks they have invested will start to go down.
The Fed band-aid will only take it so far before money returns to Gold again.
The next 6 months will be interesting.
For one thing, the Federal Reserve has cut interest rates to shore up the economy. Lower rates tend to push investors out of bonds and into stocks.
The Fed rate cuts have also given investors greater confidence that a recession is further away. Lower rates reduce borrowing costs for consumers and companies seeking loans to buy a house or car or to expand a business. They generally lead to more good things for the economy.
The central bank reduced rates mostly over worries that the U.S. trade war with China could endanger the economy, but tensions have eased as both countries returned to the bargaining table. That’s added to the confidence on Wall Street DJIA, +0.80% . SPX, +0.77%
Conclusion:
Funds are moved to where more gains will be made and hence Gold will remain as is, or sideways trading.
Those who have diversified their accounts have already done so and will not add more Gold unless the Stocks they have invested will start to go down.
The Fed band-aid will only take it so far before money returns to Gold again.
The next 6 months will be interesting.
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This community has signals now but with no risk management comms.
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