Gold buyers prepare for gold’s breakout [Video]

Giles Coghlan LLB, Lth, MA Financial Source

After the surprise CPI data from the US last week there are growing concerns about rising inflation. These fears increased with the University of Michigan consumer sentiment print on Friday. The US University of Michigan May prelim consumer sentiment was a big miss at 82.8 vs 90.0 expected. The 1 year inflation expectations rose to 4.6% vs 3.5% expected. The rise in CPI will trouble the Federal Reserve. In simple terms when prices rise cash has less value. The more inflation rises, the more prices rise, the less value cash has. One solution for investors may be to buy gold. However, as soon as the Fed announce bond tapering then gold will fall.

Is now the perfect time to buy gold?

Key Trade Risks: If the Federal Reserve announce bond tapering then gold prices should fall.

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Author

Giles Coghlan LLB, Lth, MA

Financial Source

Giles is the chief market analyst for Financial Source. His goal is to help you find simple, high-conviction fundamental trade opportunities. He has regular media presentations being featured in National and International Press.

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