(Kitco Commentary) - Gold has had a tough few weeks. After stalling in the $4,150 area, prices have slipped back toward $4,070 as the dollar jumped on a strong jobs report and traders braced for one more Federal Reserve hike in December. On the surface, that looks like bad news for metals. Underneath, the bond market is telling a very different story, and I believe it may be setting up one of the better buying opportunities in gold this cycle.
If you want to know when we think the market turns, register for Navigating the Week Ahead, our weekly newsletter. Every week we lay out the levels, catalysts and trades we’re watching, so you’re positioned before the move instead of chasing it. Sign up here.
Daily Gold Chart
The 2-year Treasury yield follows the Fed, and right now it’s pricing in a central bank that isn’t finished. Inflation has run hot, the labor market just surprised to the upside, and a December hike appears very much on the table. The 30-year bond is telling a completely different story. Long-term yields have started rolling over even as the Fed talks tough. When long-term rates fall while the Fed is still tightening, investors are saying growth is going to slow, and tha...