Drivers behind the recent gold rally
“Gold rallied nearly 4% in December, mainly in the second half of the month, and recently moved to an intraday high of US$1,613/oz as the US-Iran confrontation unfolded. We believe there are a few likely reasons for the move. . .”
USAGOLD note: In this article, Perlaky runs through six factors driving gold to higher ground over the past few weeks in the paper gold market – four of which are not commonly tracked in financial media including the positive effects of derivatives’ positioning, why light trading volumes have made a difference, and professional investor portfolio positioning prior to the end of the year. He also offers a few brief thoughts on three drivers that have gotten a lot of attention in financial media – technical charting signals (please see chart below), the Fed’s repo policies and geopolitical risks. All in all, an informative look at what drove the recent run-up in gold prices.
Chart courtesy of the World Gold Council
Repost from 1-14-2020