Although we could make a logical case that the hundreds of billions of dollars worth of QE that is being added to the global-financial system every month by the central bankers, at some point, should have unintended consequences that should chase money flow out of paper into gold.
However, the fact of the matter is that the gold market continues to behave 180 degrees contrary to such logic.
In fact, any whiff of higher-interest rates on the long end of the curve, of better growth, or improved employment data, and the gold market experiences renewed exodus of capital.
Unintended consequences be damned!
As we speak, gold is down in excess of $25 concurrent with a back-up in US 10-year T-note Yield of 5 bps, to 2.80% from 2.75%.
Let's notice that the gold-price structure is bearing down on critical intermediate-term support from $1210 to $1180.
This must contain the onslaught to avert downside continuation to the $1150 area, which represents the 62% give-back of the entire 2008-2011 bull leg from $680.75 to $1921.50.
At this juncture, only a sharp-upside reversal, and sustained climb above $1258, will begin to argue that the current onslaught has reached downside exhaustion.