US debt negations have been delayed again, by squabbling political parties. We are told that in May everything will be fixed, but the debt continues to grow, and so does pressure on the US dollar.
The US dollar is vulnerable to a “loss of confidence” event. That could create a stunning decline, and a powerful move higher in the price of gold. A key level that I watch on the US dollar chart is the 80.50 area, which never seems to hold for very long.
This chart has numerous head & shoulders top patterns on it, and it closed out the month of January below 80.50, which is a very ominous sign for dollar holders, and great news for gold!
As this debt crisis continues to unfold, I expect more investors to transfer money from paper gold products to physical gold.
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