Cool. These are on the macro front but very relevant to the gold sector and miners broadly. I've previously posted the below in the RMS threads about 6 months ago but it's time to pay attention to them again.
Gold did not sell off anywhere near what it should've with the yields being as high as they've been this year, it's held up remarkably well. As gold and the yield on US treasuries are inversely correlated, observing long rates rolling over is very interesting because if they continue in this direction, gold will be pushing new high's in the near future. What's most interesting is the US30 is particularly outperforming which says a lot about future rate expectations. This is also visible in the TLT 20+ year treasury ETF which has broken out of the intermediate down trend. Rates led the Fed by 6 months on the way up and now appear to be leading indicator in the opposite direction.
There's a lot of different explanations for why this is occurring and why it's happening now etc. However that's not material here and outside of the scope of this post. The important takeaway is to view this as the market expectations for rates being lower not higher going forward which is very bullish for gold and more specifically bullish for a Aus based miners where exchange rate differentials amplify P+L in both directions.
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