InvestorQ : What does the future hold for gold price movements from here on?
Juvina Maggie made post

What does the future hold for gold price movements from here on?

Angel dcosta answered.
3 years ago

The million dollar question now is whether this is the end of the rally in gold or a temporary blip. While there arguments like dollar strength and alternate fiat currencies, it may be more of a temporary blip in gold prices before it resumes its uptrend. Let me explain...

Dollar strength owes its origins to weakness across the world as well as cheap oil. Also the Fed decision to hike rates has been positive for the dollar. But the dollar has rallied for too long and has started pinching exporters.

The rapid money expansion that we are seeing today is exactly like we saw in the 70s and that has to make gold more valuable. After all, Bitcoin may still be years away from being taken as a serious alternate non-fiat currency.

We have seen more wars in the last few years than at any time in the last 20 years. Russia is battling Crimea and there is a battle for supremacy in the Middle East. 25 years after the demise of the USSR, China has started flexing its muscles and threatens to emerge as an alternative power centre.

The weakness of gold is largely attributable to the strength of the dollar. There is too much liquidity and too much debt sloshing around in the system. As sanity returns to markets (as it is happening in China now), the wonders of gold will be back in reckoning. That does not seem to be too far off!