(This is Part II in our series Why Isn’t Gold Rising. You can read Part I here.)
GLD, our unleveraged ETF trading proxy for gold prices, dipped its toe below 123.50 back on Sept. 20th, and hasn’t been able to climb back out since then. Here’s the 3-month chart of GLD showing the recent action – or lack thereof.
All through this sideways-action period, gold bulls have been asking the question: Why isn’t gold rising? They cite financial problems in Europe, increasing deficits in the US, and the ending of QE/start of QT programs as “proof” that gold prices should be heading up.
In case you’ve been hiding under a rock, QE stands for Quantitative Easing, or money printing, and QT stands for Quantitative Tightening, or giving us our money back. These were and are programs run by the US Federal Reserve and the European Central Bank to support their respective economies following the 2008-2009 market declines.