| For some reason, gold evokes more intense emotions for traders than any other financial instrument. Depending on who you talk to, gold is either the last real store of value amidst the final throes of the central bank driven fiat currency system…or a soft yellow rock with few industrial uses. Rather than dogmatically holding to either a permanently bullish or bearish outlook on any financial asset, we believe that traders that should keep an open mind and try to objectively analyze the fundamental drivers of gold.
Like any commodity, the price gold is determined by the interaction of supply and demand. While the supply of gold is relatively predictable in the short term, the demand for gold is rarely the conventional type of industrial demand that drives most commodities. Instead, gold demand is driven primarily by its attractiveness as an investment, which is in turn driven by real interest rates and the value of the US dollar......................................Full Article: Source
|