Floating of Yuan Good For Gold Price
Jim Sinclair of jsmineset.com had some very interesting comments to make about this historic event and its impact on the future gold price.
Sinclair sees floating of the Yuan against a basket of currencies as effectively breaking its tie solely with the US dollar.
Sinclair says "this is an undeniable move away from the US dollar and will impact the thinking of those central banks who have already or are preparing to diversify out of complete reliance on the US dollar as a reserve currency."
"The most important implication of this move is that it reduces the need for China to purchase US Treasuries in the amounts accumulated in the past. " said Sinclair.
Sinclair concludes, "the move by China is presently neutral for the dollar but in a short time it will be recognized as negative."
Sinclair says "the strengthening in the recent lows for the gold price in this reaction. At the same time, the recent highs of the US dollar now become more significant as resistance and will be viewed as a probable top range should it be revisited.
Jim Sinclair's prediction for the gold price is that it will trade to $480 then $518 to $529. Sinclair says "The dollar will return in time to the .8050 level and much lower levels thereafter."
Now is the time to back up the truck and load it with gold coins.