Don’t be fooled by the shenanigans in the paper futures markets, rising oil prices are wildly bullish for gold and silver.
Rising Oil Prices Are Wildly Bullish For Gold & Silver
September 3 (King World News) – This is a small portion of a very large report released by the always brilliant Jesse Colombo: Let’s start by reviewing the latest action in crude oil, with WTI crude rising from around $80 a barrel to roughly $90 and Brent crude also gaining about $10 a barrel. The surge was triggered by renewed U.S. strikes on Iran after a multiweek hiatus during which the U.S. attempted to rely primarily on economic sanctions.
However, Iran is becoming increasingly defiant and is even going on the offensive against neighboring countries and U.S. outposts in the region, in addition to its ongoing strikes against tankers in the Strait of Hormuz.
This is an ugly situation, and it doesn’t seem to be ameliorating anytime soon. There is enormous uncertainty surrounding how this quagmire is ultimately going to play out, and the markets, including precious metals, are practically surging and plunging every other day based on the latest developments in the war.
One day, we hear that the Strait of Hormuz is open, only for it to close again, and similarly, the U.S. signals that it intends to hit Iran hard, only to suddenly back off again. It has been going on like this since March, and I speak for many people when I say that it is extremely tiring and confusing.
Meanwhile, the U.S. Strategic Petroleum Reserve has fallen by another 3 million barrels and is now at its lowest level since 1982, with other countries’ reserves similarly depleted.
As a result of the latest escalation with Iran, both WTI and Brent crude oil broke out of the triangle patterns I showed in my recent report about investing in energy. These breakouts increase the odds of oil rising even higher, but as many of you probably know by now, breakouts above diagonal trendlines, such as the upper boundary of a triangle, are not as reliable as breakouts above horizontal resistance levels and zones, such as $92 to $97 and $112 to $120, which formed at key peaks in crude oil.
As someone who also invests in the energy sector, I am waiting to see whether crude oil can surpass those resistance zones. If it does, it would greatly increase the odds that crude oil is about to rise even further. I recommend reading my recent report to learn about the different ways to invest in energy.
Even if you aren’t interested in investing in energy, it still matters to the overall global economy and financial markets, including precious metals. While rising oil prices have put downward pressure on precious metals and base metals since the U.S.-Iran war began, this is a historical anomaly, as energy, metals, and other commodities have typically rallied in tandem during commodity bull markets. I expect that to be the case over the coming decade as well.
In the short term, however, spikes in energy prices have put downward pressure on precious metals by increasing inflation and interest rate expectations, which weighs on precious metals because they are non-yielding assets.
My latest approach and philosophy for dealing with this frustrating conundrum, as someone whose portfolio is heavily weighted toward precious metals, is to also diversify into energy, base metals, and agricultural investments. The idea is that when one zigs, another zags, helping to offset each other’s swings, while I ultimately expect them all to climb together over the next decade as the commodities supercycle truly gets underway. KING WORLD NEWS NOTE: Crude Oil, gold and silver prices have historically risen in tandem. However, there is a desperate attempt in the paper markets to fool investors into believing rising crude oil prices are bad for gold and silver. So oil up, gold and silver down, and vice versa. Aside from the shenanigans in the paper futures markets, rising crude oil prices are extremely bullish for gold and silver, so expect gold, silver and oil prices to rise in tandem in the years to come.
Man Who Correctly Predicted Gold Would Skyrocket In 2024
To listen to Gerald Celente, who correctly predicted at the beginning of 2024 that gold prices would skyrocket, discuss what he expects from the gold market today CLICK HERE OR ON THE IMAGE BELOW.
JUST RELEASED: GOLD & SILVER!
To listen to Alasdair Macleod discuss this week’s wild trading in gold and silver and what to expect next CLICK HERE OR ON THE IMAGE BELOW.
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