So why is this happening?
Well, gold bottomed anyway. You can see my post from last week about that ...
And as for the recent acceleration, well, we can thank Fed Chair Janet Yellen’s speech yesterday.
She said the central bank plans to keep its interest-rate target low for a considerable time after it ends bond-buying. That sent the Dollar Index to the lowest level this month. Since gold is priced in dollars, the two often move in opposite directions.
And here’s yesterday’s FOMC statement: “The Committee currently anticipates that, even after employment and inflation are near mandate-consistent levels, economic conditions may, for some time, warrant keeping the target federal funds rate below levels the Committee views as normal in the longer run."
In other words, low rates FOREVER!
To be sure, gold could tuck its wings and swan-dive from here. This market is a mean bitch. But when you get on the right side of it, it can be darned profitable, too.