Dennis Gartman Blog and News
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I have liked gold solely in euro terms and in yen-denominated terms. The monetary authorities in Europe and in Japan have no choice but to continue to be extraordinarily expansionary. Their economies are weak and getting weaker. Our economy is at least holding up reasonably well. By December, the Fed will probably take the overnight rate up 25 basis points.
Europe can't even consider the notion of tightening in at this point. The political and economic circumstances mandate that the ECB remain as expansionary as it can be. Therefore, gold in terms of the euro can go a good deal higher. I'm very bearish of the euro itself. Once we get under 1.095, the next stop is 1.05, and then we go to par.
Let's say dollar gold holds steady at $1,250 or so, and the euro goes to 1.05. In that instance, gold predicated in euros—and an ETF like the AdvisorShares Gartman Gold/Euro ETF (GEUR)—goes up another 5% or 6% from these levels.
So I'm bullish gold, but only in terms of the euro primarily, and then in terms of the yen secondarily.