After the presidential election in the United States, USD had the most powerful rally, and the same asset-haven gold, where investors urged to invest in the case of victory of Donald Trump, has fallen by more than 5% and reached almost half-year lows.
In general, the current situation can be described in one sentence: while Americans have not voted for the person for whom it was assumed, the markets behaved not as it was expected from them. 8000 tonnes of "paper" gold, which is almost twice more than the annual volume of world production, were sold on the day after elections.
According to analysts' expectations, the yellow metal may fall to $1.200 an ounce - a level at which the gold was traded in the period from mid-2013 until the end of 2015.
On the other hand, today's lows may well form the bottom of a new rising channel, as a fundamental aspect of this metal, when it comes to long stretches of time, has become much more positive than it would be in the case of victory of the candidate from the Democratic Party Hillary Clinton.
It's all in the economic program of the newly elected president. Firstly, it involves significant spending - on infrastructure, defense industry section, health, education, and to ensure the United States energy independence.
Secondly, the new head of the Americans promised easing of the tax burden for corporations by lowering the amount of the upper limit of a progressive tax on the profits, which means lower tax revenues.
In contrast to the policies of the outgoing American administration, when the currency liquidity, intended to stimulate the economy, pumped through the banking sector and remained there, resulting in a sharp increase in stock indices and hidden economic stagnation, Donald Trump's program involves stimulating the real economy directly through the Keynesian model of state regulation.
When the real sector of the national economy is stimulating, there appears a real inflation, not artificial. And the growth of real inflation has always been an excellent indicator for the fans to invest in gold.