Commodity Trade Mantra

Posts Tagged ‘Chinese Currency Devaluation’

Why a Fed Rate Hike Could Be a Blessing for Gold Prices

I think the timing of a rate hike has been overhanging the gold market for well over a year. Relieving that issue could actually prompt a short covering rally. It would be kind of a sell-the-news event where the shorts figure that the trade is over and this is a good time to begin covering, more and more head for the door, and we have the rally underway.

Chinese Devaluation Extends To 3rd Day - Yuan Hits 4 Year Low

Having devalued the Yuan fix by 3.5% in the last 2 days, China did it again, shifting Yuan to 4 year lows. While confusion reigns over why PBOC would intervene at the close to strengthen the Yuan last night, the reality is the commitment isn’t to a devaluation for China’s exports, but its actions are directed toward trying to keep the wholesale finance interfaces somewhat orderly.

Gold Soars After Chinese Currency Devaluation

Over one billion Chinese will soon be scrambling into gold to preserve their purchasing power after the PBOC’s dramatic devaluation announcement. Any day now the PBOC will update its revised foreign reserve and gold holdings. And so the next big leg up in gold will take place when it is revealed that the PBOC had only exposed a portion of its “new” total gold inventory.

Currency Devaluation Coming Soon To China

Keep your eye on the market & listen. The global trend in stock prices is still bullish. The market doesn’t yet see any reason to panic over these big picture forces that are playing out under the surface. We’re going through a mild correction but not enough to turn the market bearish. A Chinese currency devaluation might change that but it could still be a year or so away.

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