A convergence of key indicators is signaling the dawn of a precious metals bull market, bringing renewed attention to gold and miners. The current financial landscape paints a compelling picture: The S&P 500 and Nasdaq are scaling all-time highs, reflecting robust market performance. Both Bitcoin and gold are approaching all-time highs, serving as alternative safe-haven assets. Inflation is rebounding, injecting momentum into the precious metals market. Financial conditions are the most accommodating in two years, creating a favorable environment for precious metals.
Despite these positive signs, sentiment in the precious metals sector is notably low. Miners are grappling with distress, and overall capital spending is at unprecedented lows. Implied volatility remains historically suppressed, contributing to a prevailing sense of market distress. The gold-to-silver ratio is at an elevated 90, signaling potential for a silver surge.
Several fundamental factors also contribute to the bullish outlook for precious metals, including central banks accumulating gold at a record pace, overwhelming global debt levels, marginal new gold discoveries, and a deterioration in the quality of existing reserves.
Gold, leading the charge, recently surpassed $2,100 per ounce, marking its highest level since December 2023. Impressively, it stands just 2% away from a new all-time high, even as Fed rate cuts are delayed. The recent weakness in the US Dollar further propels gold prices, setting the stage for a potential breakthrough.
As the shadows of uncertainty loom over traditional markets, gold and miners emerge as beacons of resilience, hinting at a glittering future for precious metals.
Sources:
1. The S&P 500, and Nasdaq at all-time highs
2. Bitcoin and gold near all-time highs
3. Inflation has been rebounding
4. Financial conditions the easiest in two yearsThe Fed: We need to cut rates three times this year and the market agrees
This gonna age well pic.twitter.com/thrkbn52xF
— Global Markets Investor (@GlobalMktObserv) March 4, 2024
Welcome to the beginning of a precious metals bull market.
Sentiment in the toilet, miners completely distressed, overall capital spending at unprecedented low levels, historically suppressed implied volatility, gold-to-silver ratio at 90, central banks accumulating the metal at… pic.twitter.com/zgSJxsNRNu
— Otavio (Tavi) Costa (@TaviCosta) March 4, 2024
Gold is back:
Gold prices just jumped above $2,100/oz for the first time since December 4th, 2023.
It's also now just 2% away from a new all time high, even as Fed rate cuts are delayed.
Recent weakness in the US Dollar has propelled gold prices.
Our subscribers have been… pic.twitter.com/WIJOZ66rSn
— The Kobeissi Letter (@KobeissiLetter) March 4, 2024
3 Whoppers, 2 fries, and 2 large vanilla shakes were $7.98 plus tax in 1986
Today it's $30.73 in Dallas (assume medium fries, shakes are no longer offered in sizes)
The BLS says the inflated price should be $22.31
Real price increase is 59% greater
(Taxes also higher) pic.twitter.com/nTwVYTVhNo
— Sean Kelly 🪓 (@skenzyme) March 4, 2024
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