Yield Curve steepens under inflationary pressure while Gold’s monthly chart patiently builds its Handle
Another week, another yield curve steepener and continuation of the trend that began in August, 2019.
Flipping to the bigger picture I added in SPX, Gold and the CRB commodity index for reference. With the levels of MMT TMM (total market manipulation) injected in the markets since Ben Bernanke cooked up the diabolical macro manipulation known as Operation Twist I can’t pretend to quant the past to the present…
…but one observation above is that gold is in a giant and bullish Cup with the Handle-making as anticipated since the correction began from a higher high last summer, still in process.
Ref. a November post, Building Gold’s Handle
Here is the updated chart from that post. It always was going to be an extended grind to put in a proper Handle on this monthly chart. Gold is doing good work and it is doing it in a preferred (i.e. not Goldilocks) environment. Goldilocks is a product of a flattening yield curve’s boom, and a steepening yield curve is either inflationary bullish or deflationary bearish. Or as per the last cycle, both.
This is definitely not Goldilocks, which not coincidently attended gold’s bear market every step of the way.
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Follow via Twitter @NFTRHgt.
Subscribe to NFTRH Premium for an in-depth weekly market report, interim market updates and NFTRH+ chart and trade setup ideas. About NFTRH
Gary Tanashian of nftrh.com successfully owned and operated a progressive medical component manufacturing company for 21 years, keeping the company’s fundamentals in alignment with global economic realities through various economic cycles. The natural progression from this experience is an understanding of and appreciation for global macro-economics as it relates to individual markets and sectors.
Biiwii.com (RIP 2019 as there were just not enough hours in the day for two websites) was created in 2004 as a way to help communicate a message about deeply rooted problems with too much debt and leverage within the inflated financial system. Our concerns were confirmed and our message justified in 2007 as the system began to purge these distortions, resulting in a climactic washout extending from October, 2008 to March, 2009.
But the URL ‘biiwii.com’ came from the old saying ‘but it is what it is’ and this sentiment addressed the need to remain impartial about the markets, despite personal beliefs. Over the long-term, the world changes and any successful market participant should be ready to accept changes or revisions to a given plan.
Geek-like interests in technical analysis and human psychology, and various unique macro market ratio indicators were added to the mix, with the result being a financial market report, Notes From the Rabbit Hole (NFTRH), combining these attributes to provide a service that is engaged and successful in all market environments.
Since 2004 our work has been featured at financial websites including GoldSeek and SilverSeek.com
