Gold Hurdles to New Record Highs

June 1, 2010 – Numerous records continue to be broken by gold, including some longstanding ones that go back to the January 1980 peak. Gold closed the month of May at a new record high against every major world currency except the Japanese yen.

Various charts of the gold price in terms of major currencies can be found by clicking this link. Here is a long-term gold chart in terms of US dollars.

The important point of this chart is that gold is climbing in a major uptrend, which is denoted by the rising green trendline under gold’s price. Note too that the deep 2008 correction following the Lehman Brothers collapse did not move gold back to the uptrend line, which is a clear sign of strength. Since its correction in 2008, gold has been moving away from the trendline. This development means that gold’s upside trajectory is accelerating, which is another sign of strength.

It is not difficult to understand why gold’s chart looks so powerful. The global monetary and banking system continues to unravel from too much debt, a large portion of which is of substandard quality. Also, the worsening sovereign debt crisis is highlighting the risks of all national currencies, while making clear the unrivaled safe haven attributes of gold.

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