Why A Trump Win Is Hugely Bullish For Gold

posted in: Charts, Gold, Gold Stocks, S&P 500 | 0

With key swing states Florida and Ohio falling to Trump the New York Times is gauging the probability of a Trump win at more than 95% (a virtual certainty that he will be the next US President at this point):




Equity futures have slumped around 4% while gold futures have soared more than 3%:



Given what markets were already looking forward to in terms of a December rate hike and Hillary’s economic proposals, a Trump win is especially bullish for gold and here’s why:

  • A Fed rate hike cycle is pushed out even further and there is a better than 50% that there will not be a December rate hike.
  • Trump’s economic policy proposals are likely to shave a considerable amount off GDP growth due to trade protectionism, this will result in more accommodative monetary policy for longer.
  • Trade protectionism and weaker growth are dollar negatives.
  • Trump is a wild card and much more of a destabilizing President than a President Hillary Clinton would be, gold does better in a chaotic backdrop as a flight to safety asset.
  • Foreign central banks are more likely to be accommodative in their monetary policy stance to counteract what they deem to be a chaotic environment in the US.

Gold investors have just been rewarded for their perseverance and with the yellow metal surpassing $1320 in overnight futures trading the key $1310 level becomes support once again.


DISCLAIMER: The work included in this article is based on current events, technical charts, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decision based solely on what you read here. This publication contains forward-looking statements, including but not limited to comments regarding predictions and projections. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. The views expressed in this publication and on the EnergyandGold website do not necessarily reflect the views of Energy and Gold Publishing LTD, publisher of EnergyandGold.com. This publication is provided for informational and entertainment purposes only and is not a recommendation to buy or sell any security. Always thoroughly do your own due diligence and talk to a licensed investment adviser prior to making any investment decisions. Junior resource companies can easily lose 100% of their value so read company profiles on www.SEDAR.com for important risk disclosures. It’s your money and your responsibility.