Gold - The Tea Leaves Say: More Downside On Deck3.5% is a lot in gold, and that's about the range of the total landslide we've been through the entirety of August so far.
It's the kind of pattern where goldbugs and USD collapse narrative nerds go long and go long or hodl and hodl but the price never goes up.
In my last call on gold from the beginning of July, I warned that $2,000 was a death trap. That call was pretty successful, coming just a few dollars shy of the target, abeit it was because the next month's futures contract settled some 2% higher.
Gold - $2,000 Is a Death Trap
And with the index markets at large, I caution that Nasdaq not breaking 15,000 is actually a real bull trap
QQQ - Is It Rally Time? Or Are You Too Early?
With gold, geopolitical risks are heightened because Xi Jinping and the Chinese Communist Party he has yet to throw away bought a lot of gold, and at relatively high prices, according to media reports at least.
And thus, because of this, a form of subtle on-the-low economic sanctions against Xi and/or the CCP can be to devalue the price of gold, which puts the central bank in a bind.
And this is a real problem for China right now with all the other economic catastrophes that land one after another, and the flooding, and the instability, and the posturing of the International Rules Based Order about war/invasion via Taiwan.
The CCP won't invade Taiwan. But China might get invaded by the IRBO via Taiwan.
You might not believe it. But give it some sober thought. Tacticians are tacticians for a reason. Hitting from the shadows and blind spots is a real useful thing.
But for Xi, he can always weaponize the 24-year persecution against Falun Dafa that was launched on July 20, 1999 by former Chairman Jiang Zemin against the entire world.
Because the whole world has been going to Shanghai to train under the Jiang faction for economic and social benefits. Which means a lot of closet skeletons. Which means a lot of data dumps can serve as weapons delivered to international media in the future.
Anyways, here's the call, friends.
Gold is obviously going down and will go down farther. It really looks like it's seeking at least the short term lows, which means $1,900 is longzo-gonzo.
And so on a dump from where we're at at time of posting to, say $1,850, you're getting 5% on a very safe short.
You can short the hole.
And 5% is a lot of money on gold.
Probably only at $1,850 can we look for reversal longs towards new all time highs.
But with how lethargic gold has been, we may very well just have seen the top on the re-run to $2,080.
