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Nicely bullish-looking chart here showing gold breaking out to new highs against a basket of eight emerging-market currencies (China, Mexico, South Korea, Turkey, India, Russia, Brazil, South Africa).
- Lemon Quarter
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After a couple of years of low volatility (XIV doing well), my guess is higher volatility across 2018. I'm inclined towards western world neutrality, equal shares of US$ GB£ (holding stocks) and gold. More often the best performer outweighs the poorer performer ... and more. However, as XIV is like a 5x long stock, predicting poor XIV is suggestive of US stocks down/flat (stronger US$ = potential decline in gold priced in $ as well). More so given US expectations of three interest rate rises across 2018. Accordingly I'm anticipating that after the last couple of good gain years, 2018 could be a flat or even mildly negative year. Which is usually a indication for a good EM year. Lower EM currencies value relative to gold is also suggestive of likely higher EM share prices. As however massive US tax break injections take hold, who knows ... could turn out yet another US stocks up a lot, $ continuing to decline, gold up year i.e. XIV could decline due to increased upside volatility. Quarter each in BRK-B, FT250, gold and EM seems reasonable as a 2018 buy and hold for the calendar year.
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