Gold exchange traded funds are partying like its 2009 again. Inflows into the two big gold ETFs hit $5 billion in February. He wasnât in yesterday. But I can imagine if he was, Charlie Morris from the Fleet Street Letter would be feeling pretty good about his advice to buy gold on February 8th. And thatâs even acknowledging that for cyclical reasons, gold tends to struggle in February.
The last time inflows spiked like this, the S&P 500 had already fallen by 18%. The index is down only around seven percent at that time, although it did fall around 14% from the May 2015 high to intraday low on February 11th. What does this tell you?
Well, I canât speak for Charlie. He speaks for himself in this discussion we had a few weeks ago. But there are three elements in his âgold regime.â Two of them are bullish and one of them is neutral. The interest rate environment is bullish. The February signal was generated when gold broke out in multiple currencies. But it still hasnât broken out against stocks. Thatâs the third signal.
Category: Market updates