GOLD remains 20% below the 1980 peak inflation adjusted
Source: DB, Win Smart
Central banks are on pace to buy over 1,000 tons of gold again
Despite the near-record annual purchases, it's worth noting that these institutions once held 80% of their balance sheet in gold Today, it's barely 20%. A return to the historical average of central banks holding 40% of their balance in gold could propel gold prices north of $3,000 based solely on that capital dynamic... Source: Tavi Costa, BofA
A golden cross on gold (50d MA is trading above 200d MA and both are trending higher)
Source. Bloomberg, Tavi Costa
Interesting market action... Bitcoin and Gold just moved in sharply opposite directions after weeks of similar price action. Beginning late Sunday night, both assets jumped sharply
Since then, Bitcoin is up 6.5% while gold prices have posted a massive $100 reversal. Some shift from gold to digital gold? Or just a random short-term divergence? Source: The Kobeissi Letter
Gold hit record high 2'135.39/oz in early trading hours
Gold surged to a new all-time high as growing expectations for US rate cuts early next year. This latest leg of gold's rally has been turbocharged by comments on Friday from Fed Chair Jerome Powell. Precious metal's strength has been underpinned buy other factors as purchases by governments and central banks as well as geopolitical uncertainty.
A wake-up call to start the week with Gold trading above $2,100 and digital gold aka bitcoin trading above $41,000
I do see 2 messages here: 1) Short-term: Mr Market believes Mr Powell is bluffing, i.e rate cuts are coming; 2) Long-term: dollar debasement is inevitable. Investors and central banks are looking for reserve status
Is massive buying by China the main reason for the current gold rally?
Gold trading above $2,000 despite real fund rates above 2% and the strong dollar is one of the main surprises of 2023. One theory is that China's "Massive Accumulation Of Gold" is behind Gold resilience this year. Indeed, according to unofficial tallies - such as that kept by Gainesville Coins analyst Jan Nieuwenhuijs - total gold purchases by the Chinese central bank (reported and unreported) are significantly bigger than what has been officially disclosed, and in Q3 alone, China purchased 179 tonnes of physical; year-to-date the PBoC bought 593 tonnes, which is 80% more than what it bought in the first three quarters last year. As such, China's total estimated gold holdings are 5,220 tonnes, more than twice what’s officially disclosed at 2,192 tonnes... Source: www.zerohedge.com
They just started buying gold...
CTAs have reversed the gold short into a long, but they could be buying much more on the back of this break out. They are more than happy to play this momentum move... Source: Bloomberg, TME
