Risk implied for gold by this picture

  • Post author:
  • Post category:Gold

Gold as correlated with the CPI/TNX ratio has implied downside

Earlier I saw some stuff about a gold breakout and thought about how they never seem to learn. They either never learn or they never want followers to learn (too much). It’s like those scary social commentary stories; keep the masses dumb, stupid and asleep. But that is just me, being judgemental and unlikable (by some), as usual. I’ve never claimed to be a team player and certainly not so about Team ‘Go Gold!’.

I commented thusly (fwiw, I am barely aware of the re-tweeter and not at all aware of original “Next stage under way… Breakout!”) tweeter.

Chart porn? Really? I’ve seen things in gold that get me much more aroused. But the re-tweeter seems to know it’s goofy. I don’t know why he’d spend a retweet on it.

While I have been keeping a completely open mind about gold and silver, here is a chart from the dark side arguing one fundamental impediment to the pom pom brigade. It’s a log scale weekly chart of gold and the CPI as adjusted by the 10yr yield.

The daily chart below shows that the 10yr yield has continued upward since the September 1st cut off date of the chart above. So unless CPI has also ramped up vigorously, and since gold has been rallying since September, risk – by this picture – would be implied for gold. A chart similar to this was included on October 1 in an NFTRH update discussing gold’s inflation utility (such as it is) called When Inflation Works for Gold (still password protected).

Anyway, I think the situation is at least as negative now as implied on the CPI/TNX chart above, but if you have refuting evidence about CPI that you can send me (contact link above) I’ll be glad to edit it into this post. Meanwhile, a bullish stance on gold – considering its intact downtrend that was intact even after that puff piece tweet at top – is little more than… well, you know what it is.

For “best of breed” top down analysis of all major markets, subscribe to NFTRH Premium, which includes an in-depth weekly market report, detailed market updates and NFTRH+ dynamic updates and chart/trade setup ideas. Subscribe by PayPal or credit card using a button on the right sidebar (if using a mobile device you may need to scroll down). Keep up to date with actionable public content at NFTRH.com by using the email form on the right sidebar. Follow via Twitter @NFTRHgt.