BREAKING: Gold Buy Signal Just Emerged
“The flap of a butterfly’s wing can produce a typhoon half a world away.” ~Chaos Theory
In a market full of cause and effect, sometimes the most unexpected consequences result from actions taken by politicians or investors.
For instance, did you know that the Trump trade war has actually caused a major buy signal for one of my favorite wealth-building markets?
While trade war fears have sent stock prices spiraling for the last several weeks, one specific market is set to skyrocket! And this week’s buy signal gives us the perfect opportunity to jump in and take advantage of this unintended bull market.
Connecting the Dots for a Golden Opportunity
If you look at how the stock market is responding to the escalating trade war with China, you might think the news is all bad.
But here at The Daily Edge, we know that there is always an opportunity to make money, no matter what the market is doing. And today, I want to show you how the “butterfly effect” is creating a chain reaction leading to one of the best wealth-building opportunities I’ve seen in years!
Let’s start by connecting the dots. Once you understand how this opportunity is playing out, you’ll be in perfect position to bypass stock market risk and add to your wealth.
The first thing we know about this situation is that the trade war has led to business uncertainty.
Since it is unclear whether tariffs will remain in place, or how China will retaliate, businesses are postponing decisions. This means that some companies are not buying inventory to replace merchandise that is being sold. After all, they might be able to buy merchandise cheaper once tariffs are lifted.
Similarly, some businesses are putting off decisions to open new plants, hire new workers, or pursue other growth opportunities. They’re waiting for clarity on the trade front before making any big decisions.
Thanks to this uncertainty, the Fed believes there is a risk of recession.
Now that doesn’t mean the Fed expects a recession is imminent. After all, the U.S. economy continues to grow at a healthy pace and unemployment is very low. But with businesses putting off some important decisions, there’s more of a risk that growth will deteriorate. And the Fed has a mandate to help keep our economy in a healthy place.
This means that the risk of recession will cause the Fed to cut rates.
I know… If you’re a saver like me, you might think this is bad news. Interest rates are already low and the Fed was in the process of raising rates last year.
But today, with so much uncertainty in the economy (and with no inflation to worry about), the Fed has a big incentive to lower rates. And by lowering rates, the Fed will make it easier for companies to afford new growth opportunities. It will make it easier for consumers to borrow money for new homes and even credit card purchases. Bottom line, lower interest rates will help to stimulate the economy during this uncertain time.
Don’t believe me? Market-based interest rates are already headed lower. And the smartest traders on Wall Street are now pricing in a 90% chance of a rate cut by August!
Still with me? We’ve got two more dots to connect and then you’ll see how this chart is actually a giant buy signal for the opportunity I’m zeroing in on today.
With interest rates already moving lower, the U.S. dollar is weakening.
This is a major shift after months and months of the U.S. dollar trading higher. But with interest rates heading lower, there’s less incentive to hold dollars in a savings or other interest-bearing account. And so institutions are moving cash out of these accounts and into places where they can better protect their wealth.
And that, ladies and gentlemen is where our opportunity lies.
With the U.S. dollar falling in value, demand for gold is rising!
We see this any time the U.S. dollar weakens. Simply put, it takes more “weak” dollars to buy an ounce of gold. So a weak dollar leads to a higher price for gold.
Over just the last few trading sessions, we’ve seen the price of gold spike higher. And as the connection between the trade war, the U.S. economy, the Fed and the weak dollar become common knowledge, we’re going to see gold trade a lot higher!
The Explosive Potential for Gold
Today, the price of gold has rebounded to about $1,325 per ounce. That’s well above the $1,280 where gold was hovering just last week!
But if you’ve followed gold over the last few years, you know that we’re well below the high from several years ago.
Back in 2011 — following the last series of Fed rate cuts — the price of gold rose to a peak of roughly $2,000 per ounce.
That’s more than 50% above today’s price of gold!
Given the high probability of a new series of interest rate cuts, and the amount of money that will be moving into gold over the next few months, I would not be at all surprised to see gold move back up to the $2,000 price.
And it could happen very quickly!
In fact, given the fact that some inflation has occurred since 2011, we could see gold actually trade significantly above $2,000 per ounce.
This is not the type of move that you want to watch from the sidelines. It’s an opportunity to grow your wealth significantly even during what may be a turbulent market for investors.
So today, I’m encouraging you to take advantage of this opportunity by increasing your investment in gold.
If you’ve already got some exposure to gold, that’s great news! This is probably a great time to add some extra capital to your position so you can make a bigger profit from gold’s advance.
And if you’re not yet invested in gold, now is a great time to get started!
It could mean the difference between sustaining losses from the market’s pullback, or building your wealth during this uncertain period.
You definitely want to be on the wealth-building side of that ledger.
Tomorrow, I’ve got three specific ways that you can increase your exposure to gold and profit from the advance.
So whether you’re new to investing in gold, or you’d just like to see what additional options you have for taking advantage of this opportunity, make sure you tune in to tomorrow’s Daily Edge alert!
Here’s to growing and protecting your wealth!