Listen folks, this is an economic indicator. While legions of gold bugs continually obsess on the metal itself as some sort of Idol, it is actually just a simple counter cyclical asset. When it is measured against cyclical assets like commodities, it can give macro signals.
The message here is that Au-CCI has broken above some moving averages that have held it down since 2012. If these moving averages cross, it would mean a condition is in place that indicated the US financial crisis and the acute phase of the Euro crisis.
Gold rooters and gold stock boosters may be chomping at the bit to get bullish, but they are going to need to be patient. This macro stuff plays out of time and we as humans tend to see things on the day-to-day.
Today’s Employment Report and the anecdotal information I have on machine tools may (repeat may) be initial signs of a better environment for the gold sector (Au-CCI is up today, not shown on the chart above), but… patience please. We have to get rid of all the bugs that think Ukraine has anything to do with anything and Indian Wedding Season is the big driver.
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