The Real Reason Gold Turned This Week, and Who's Quietly Buying | This Week In Focus

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The video discusses the recent performance of gold and silver, highlighting a significant downturn in gold prices, which experienced its worst quarter in over 13 years, dropping by approximately 13%. Similarly, silver has seen a decline, trading around $61, down about 4%. The analysis suggests that the Federal Reserve's aggressive interest rate hikes in response to inflation have negatively impacted these precious metals. Historically, a tightening monetary policy by the Fed has led to a decrease in gold prices as the US dollar strengthens and interest rates rise, making gold less attractive as an investment. The speaker notes that in the past, periods of high inflation and subsequent rate hikes have resulted in substantial gold price declines. For instance, in the 1970s, a decade of high inflation and interest rate hikes saw the US dollar's purchasing power decline by 75%, while gold's purchasing power was maintained. The current market conditions are being compared to that era, suggesting a potential for gold to act as a store of value and hedge against inflation. However, the analysis indicates that the current market sentiment for gold is more focused on the bond market's performance, suggesting that any policy changes by the Fed that lead to lower interest rates could positively impact gold. The technical outlook for gold futures suggests a potential target of $36,600, with a failure bound at $45,000, indicating a bearish short-to-medium term outlook. Similarly, silver is being watched, with a target of $40 and a failure bound at $65, also suggesting a bearish trend. The analysis implies that precious metals are currently undervalued by the market, and their long-term investment potential remains strong.

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