Is This Gold Breakout For Real? De-Dollarization may be the key factor.


by Mark Jeftovic, Dollar Collapse:

Historically, fresh all-time-highs portend drawdowns for gold.
Why this time may be different.

Gold finally did what many of us have been waiting on for a long time, and notched up a new all-time-high while closing strong into the weekend.

It’s been over three years in the making, and had some gut wrenching pullbacks in the interim.


The problem with gold over the course of The Fiat Era – is that with  notable exceptions, new all-time-highs were usually an intermediate top signal that portended an imminent, significant pullback, followed by lengthy sideways grinds that could drag out for years.
To be sure,  since The Nixon Shock in 1971, when dollar convertibility into gold was suspended temporarily  – gold has for the most part been solidly “up and to the right”, as the Bitcoiners like to say.

But that’s over a multi-decade timeframe. The intermediate cyclical and counter-cyclical moves, especially the bearish ones, could last longer than a typical trader’s career. Or  least his patience…

After the 1980 all-time-high, it took 28 years for gold to put in another one, in nominal terms. In inflation adjusted terms, gold still hasn’t surpassed the 1980 top:


Via – Inflation adjusted

When it finally did put in another  ATH as the world was heading into the Global Financial Crisis, the expectations were that it would soar. After all, it seemed as if the financial system was literally imploding, and that was supposed to be the entire point of gold.

But that isn’t what happened, gold came off hard, along with everything else – turns out that in a liquidity crisis, the “best” assets get sold off too…

Read More @