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Proof (Again) That Gold is
an Excellent Safe Haven Asset




Whenever currencies devalue, gold's price jumps. And this happened again following the recent events in Europe.
If some of us doubted gold's strong safe haven status since it started correcting in 2013, we can find plenty of reasons to trust in gold again!

Yes, gold's price dropped and the Fed tapered and even halted QE, which made many lose faith. But, one could say "gold is back" and some are already saying the next bull market has just started.

Gold should ideally be a long-term investment vehicle. Therefore the correction's significance is little.

Hopefully this article will give you new reasons for trusting the shiny yellow metal again...



The ECB's QE Programme Ignited the Gold Bulls


Currently, the "king of metals" is trading in the very low 1,300's, mainly driven by the (last week's) Swiss Franc's Euro peg cut and the ECB's 2015 quantitative easing programme - announced today by Mario Draghi in Frankfurt.

The eurozone just joined "the club".

Remember what happened in Japan?

After the announcement, gold immediately jumped decisively above 1,300 USD.

Gold is acting already as a strong hedge against the euro's devaluation.

If you live in Europe and you bought gold while it was still "cheap", then it came in well for you. But if you think you've missed the boat, just wait for the next correction and jump aboard!

Besides, if you have some US dollars, it might even help you buy more while the euro is devaluing. Read below for further details...



Gold's Disproportionate Price Rise


As a result of the above-mentioned ECB QE programme, one can observe that Gold's price jumped by roughly 100 EUR, while its price expressed in dollars is "only" slightly less than 70 USD higher.

How can this happen?

Simple: the problem in Europe is currently bigger than in the US, so gold disproportionately increased higher.
Although 1 EUR = 1.14 USD currently, the proportion of gold's rise is disproportionately inclined in the detriment of the euro: a rate of roughly 1.40.

Disproportionate price increases can occur. Gold's price is not modifying proportionally.

This disproportionate rise can be exploited by investors and turned into profit.

If you feel like you missed the boat: look at it this way: gold is still relatively cheap in terms of US dollars. You can buy more gold if you buy it with dollars.


Gold's price increase in dollars, January 2015

Gold increases in mid-January 2015 (USD price)



One can simply compare the two graphs. The difference is tremendous.
Notice the strong spike in USD above, which still remains under previous highs and, compare that with the graph below showing gold's price in euros.

We might actually witness the first phase of a new gold bull market, at least on the euro market.


Gold spikes in euros in January 2015

Gold spikes decisively in euros in mid-January 2015







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