Well, it took longer than expected but I have bought back all my gold.ax for around 11% less than I sold it for.
I'll sell it when we see the next spike and everyone starts talking gold again.
Gold-now $US1210/ounce
- Thread starter Ajax
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Well, it took longer than expected but I have bought back all my gold.ax for around 11% less than I sold it for.
I'll sell it when we see the next spike and everyone starts talking gold again.
In case anyone is wondering what an inverted yield curve looks like, Australian yields started to invert on 7/5/10 when the 30 and 90 day bank bills crossed above 2 year bond yields. (where the dark blue plot crossed below the red and pink).
This indicates short term risk is considered higher than medium term, and short term capital is starting to freeze.
If the 2,5,10 yr bond yields cross, then this is serious folks.
i know i'm going to regret this, but could you elaborate on that a bit?
In case anyone is wondering what an inverted yield curve looks like, Australian yields started to invert on 7/5/10 when the 30 and 90 day bank bills crossed above 2 year bond yields. (where the dark blue plot crossed below the red and pink).
This indicates short term risk is considered higher than medium term, and short term capital is starting to freeze.
If the 2,5,10 yr bond yields cross, then this is serious folks.
thanks for the heads up i appreciate it.
Could i be right in saying that another way of looking at this is the market is potentially looking for a future decrease in interest rates?
Could it be due to some short term funding period? ie does this regularly occur at this time of the year?
I dont have alot of experience with this, i tend to concentrate on the economic forward indicators.
Hey i just noticed Winstons post was made in May, havent the short term ylds dropped since then (this was during the European recent scare). I noticed another graph the other day showing European spreads comming back somewhat.
Well done. I expect to see more downside in the short term based on technicals.
On the AUD or US price of Gold?
On a technical note Gold (US$) broke under a 2 year trend line earlier this week, but Friday bounced back above causing me to think it was perhaps a bear trap.
We are heading out of a seasonally weak time for Gold into a strong one, but your expectations of more downside might be about the AUD price and relating to an expected increase in AUD against the USD...?
Yes overnight indexed swaps have pulled back, which indicates an acute freeze is off the cards.
30,90d rates have been stable since May.
Bond yields are still down on May but improved very slightly in the last 3 weeks, which fits with the ~5% move up on the sp200.
To me, 30,90d rates always reflect risk. Bond yields are the inverse. There's a lot of money sitting on the sidelines, reflective of an ongoing low risk appetite. The markets are foggy re US and Europe, and are waiting for a clearer economic picture sans government crutches.
The US's recent economic growth has been on the back of inventory build up, govt spending (albeit slower), building tax credits, sustained labor cutbacks, and suspension of mark to market accounting for the finance sector.
Europe has just begun to socialize PIIGS losses, and there's no plan for structural reform.
I think the markets will continue to be range bound and volatile in the short term, and I am trading it this way with very good results.
There's a bit of a consensus developing that deflation is the greater risk in the short term for the US and Europe. Until recently I thought that would be bad for the gold price, but am starting to entertain the idea that gold may be the asset class that goes down the least in a deflationary environment.
Now I feel even better about it. It seem to be when the technicals to buy are the strongest, that the pullback arrives. So hoping the opposite is therefore also true.
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