Market News: Did China Link The Yuan to Gold?

chinese gold,
Written by Mike Hammer

We’ve talked many times about the ongoing China-US economic clash, and how many expect China to eventually link their yuan (CNY) to gold. There are signs that this may be happening now.  The South China Morning Post ran an article yesterday stating China increased its officially-reported gold holdings to 1843 tonnes — an increase of a mere 4 tonnes from the previous figure.

Big yawn, right? An astute analyst, either out of brilliance or boredom, put together a chart which shows the yuan moving in lock-step with gold prices, while the US Dollar swings around wildly. Have they gone and done it — actually pinned the Chinese Yuan to gold?  Sharp forex traders would look at this chart and say “probably not”; it’s likely a normal relationship between two things that are relatively stable, and one that is not.  But conspiracy theorists will doubtless go goofy over this.  We advise taking a calm view, and simply trading on.

You can see the chart in today’s featured article, which is incredibly short.  And let us know what you think. Is this the next salvo by the Chinese to take down the US economy?
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About the author

Mike Hammer

Mike Hammer has had a wide-ranging career, with trading and investing as a continuing theme. Mike graduated with a business degree, then worked with Macy's. After Macy's he spent a summer trading his own account, which taught him a lot about trading in general and markets in particular. Trading through the Black Monday and the Crash of 1987 showed him how most people are unprepared for upheavals in their trading. He then joined a well-known financial planning firm as a financial advisor, helping regular people understand their finances and meet their life goals.

Then came the usual story - Mike met and married the lady of his dreams. They moved to upstate New York, where he worked first for a small manufacturing consulting company, then a major university. While loving the work and the higher-education atmosphere, Mike missed the world of finance. Eventually, he signed up for stock trading coaching with the Adam Mesh Trading Group, to learn from people who understood modern markets. Within a year, Adam asked Mike to become a stock trading coach.

Since then, Mike has trained over 200 individuals, spoken at several national conventions, and is a frequent contributor to conference calls across the Adam Mesh community. Mike writes The Gold Enthusiast daily newsletter, runs the Golden Hammer trading service, and participates in the Mesh Private Portfolio. He also keeps a position in international education which keep him in touch with "the student mindset". Mike closely follows the gold, energy, and financial sectors. His motto is "Plan your trade, then trade your plan!"

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