China hands us a bargain...

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China Deal Creates Opportunities For Gold Shorts And Longs

As we predicted, a potential deal with China gave Western speculators a chance to hit gold hard...and simultaneously provided a brief bargain for smart investors and nations across the globe.

I haven’t heard gold mentioned so much in the mainstream financial media at any other point in this new gold bull market.

At every market update on CNBC, for example, it seems the announcer is leading off with a note that gold’s posted another $100 day. The metal has never before enjoyed such coverage.

The reason, of course, is because gold is down $100 today, instead of rising that much.

Maybe I’m an oversensitive gold bug, but it does seem like the Wall Street talking heads are relishing this sell-off in gold that’s come immediately in the wake of President Trump’s announced “deal” with China.
 

This deal, such as it is, essentially postpones for 90 days the most onerous tariff rates that Trump was using as a cudgel to bring China to the table. In the meantime, however, the administration agreed to have U.S. consumers pay 30% more while Chinese buyers pay just 10% in tariffs.
 

I agree with my friend Peter Schiff’s view on this agreement. As he posted on X:

“The ‘great’ China trade deal simply pauses Trump's trade war for 90 days. The only deal is both sides roll back their escalated tariffs. This means we're in the same position we were before Liberation Day, except Americans are paying 30% tariffs while the Chinese are paying 10%.”

But enough of that. Let’s examine how this development really affects gold.

Gold On Sale

Of course, it’s not surprising in the least that the crisis created by the Trump administration has culminated in a much-ballyhooed solution.

This is all as intended.
 

And it’s precisely as I’ve been predicting from the beginning. Crises, even organic ones that aren’t manufactured as part of a negotiating strategy, somehow almost always manage to get resolved.
 

Despite the wailing and worrying, it seems that peace eventually breaks out.

In this case, the end result was even easier to see. As recently as last Friday, I predicted precisely this event and the market reaction in a message to our Gold Newsletter Alert readers:

“I fully expect some sort of resolution to come in the Trump trade war, and I expect that event to serve as an opportunity for Western traders to hit gold hard. I don’t, however, expect this to deter buying much at all from central banks and China, because the underlying issues — independence from the dollar hegemony and the global debt trap — remain in force.”

That about says it all. Today’s sell-off is merely a blip in the long-term uptrend.

In fact, to assume that today’s selling by Western paper-gold speculators based on temporary relief in the tariff kerfuffle marks the end of this gold bull market is to assume that this bull market was based on such speculation.

Nothing could be further from the truth. Central banks and Chinese buyers, who have been fueling gold’s ascent since February of last year, will simply take advantage of this brief bargain pricing in gold.

So the specs shorting gold today are handing us a gift.

As you can see, today’s sell-off of around $85 in gold has brought the price all the way down to the gold ole days of...a month ago.

So yes, this is just a blip in a long-term trend that has been remarkable, and will continue to be as the major trend, and the major factors, regain hold.

The good news is that even better temporary bargains have been created today in mining stocks. The gold mining indices are all down around 7% today, and there are ripe opportunities to be found there.

I believe the best opportunities are in the juniors, however, where we aren’t seeing quite that kind of negative impact today.

That’s because the best of these explorers/developers have raised money and are now making important advancements and building their value through the drill bit.

Again, I strongly recommend that you focus on building a position in the best of these junior gold stories. The best way to do that is through a subscription to Gold Newsletter, where a number of our recommended companies have already 

multiplied in value over the past few months, with more on the launching pad.

You can subscribe at the lowest available rate here.

And you can also discover some of the most exciting stories in the sector by watching my friend Kai Hoffman’s interviews with top junior mining executives on our Gold Newsletter YouTube Channel.

Just click on the links below to see some of the most recent and interesting interviews.

All the best,

Brien Lundin
Publisher, Gold Newsletter
CEO, the New Orleans Investment Conference