Gold has traded between $1,270 and $1,338 since last night…as of 10:30 am Pacific, bullion is down $2 an ounce at $1,273…Silver is up slightly at $18.37…Copper has added another 8 cents to $2.45…Crude Oil has jumped 66 cents to $45.64…the U.S. Dollar Index, meanwhile, has defied the pundits by gaining two-thirds of a point to 98.51 after last night’s sell-off as Donald Trump made history with a critical election victory over Hillary Clinton that rescued America from slipping further down a dangerous socialist path…
The uptrends in Nickel and Copper continued this morning following the Trump victory with Copper touching $2.46 a pound and Nickel rising as high as $5.26 a pound…both are holding on to strong gains as of 10:30 am Pacific…
Hillary’s elitist sneer at Trump supporters (millions of hard-working, patriotic Americans) during the campaign – they’re a “basket of deplorables” and “irredeemable”, she said – came back to haunt her last night in the “Revolt of the Deplorables” and the “Second American Revolution” that repudiated the political and media establishment, the status quo and the far-left globalist agenda…conventional opinion polls, relied on way too much by the media outlets that had become a virtual extension of the Clinton campaign, didn’t fully gauge the urge for change and the populist sentiment among the electorate, along with the enthusiasm for the most unconventional political candidate in American history…Trump’s speech before thousands of charged-up supporters in Grand Rapids, Michigan (Democratic stronghold), in the wee hours of Tuesday morning was a clear indication the election could turn out far differently than what most pundits were anticipating…
To Clinton’s credit, she was gracious in defeat this morning with a well-received concession speech shortly after 8:30 am Pacific…”We owe him (Trump) an open mind and a chance to lead”…
Widening Budget Deficits & Inflationary Expectations Will Support Gold In Early Going Under Trump
Last night’s historic victory by Donald Trump is “bullish for Gold but not explosively so”, according to the GFMS team at Thomson Reuters…Gold this morning gave up its gains from last night when it shot up more than $50 an ounce as soon it became apparent that Trump was likely going to win, but the yellow metal should become a “buy-on-dips market” in the opinion of GFMS…
“Now we need to look to the future and the swirling uncertainties around the economic and political outlook,” GFMS says. “Certainly President-elect Trump appeared to adopt a more conciliatory tone in his initial remarks than in the oh-so-combative presidential election campaign, but the markets will need more guidance before they can settle. In the short-term, therefore, further volatility and risk-off activity could easily prompt further gains in the Gold price, while for the longer-term the picture is more hazy, but points overall to further bullish action. This, though, is more likely to be on the basis of bargain hunting into dips rather than a headlong pursuit of higher prices.”
Support could come from widening budget deficits and inflationary implications, GFMS says, and that seems reasonable…broad tax cuts, huge infrastructure spending and a necessary ramp-up in the military budget (after years of cuts by Obama) are certain to increase U.S. deficits in the early going of a Trump presidency with a plan to address the debt issue through higher economic growth later in his term…an unwinding of excessive and burdensome regulations will also help spur the U.S. economy…
Credit Suisse on the Trump victory: “Trump policies are inflationary; we see this pressuring real rates despite higher nominal yields…a pillar of Trump’s platform has been to repatriate jobs that have moved overseas; in our view, this calls for a weaker U.S. dollar, in particular against the Chinese RMB…a weaker U.S. dollar and potential for competitive currency devaluations bodes well for Gold prices and could spur additional central bank demand.”
Capital Economics Increases Year-End Targets For Gold & Silver
UK-based research firm Capital Economics has increased its year-end price targets for both Gold and Silver…the firm now expects Gold to end the year at $1,400 an ounce, up from its previous target of $1,300 an ounce, while the year-end target for 2017 is $1,450, up from $1,400…for Silver, the firm looks for prices to end 2016 at $20 an ounce, up from its previous target of $19, rising to $20.75 by the end of 2017, up from the previous target of $20.50…
Gold Long-Term Chart
Below is a look at Gold going back half a century…the RSI(14) bottoming pattern between 2013 and the end of 2015 closely resembles the one between 1997 and the end of 1999 prior to the start of the new bull market…bullion exploded early this year after breaking out above a downtrend line that had formed from the 2011 all-time high…
In Today’s Morning Musings…
1. Nickel and Copper continue their surge – fascinating long-term Copper chart…
2. Zealous about Zeolite – CNZ is one of this week’s big winners…
3. Gold Bullion (GBB, TSX-V) finds more high-grade at Granada between the 2 planned open-pits…
4. Silver Standard (SSO, TSX) jumps 10% on strong Q3 earnings report…
5. Daniel’s Den – Presidential plays…
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