Crude oil prices are back near record highs today after the dollar fell to an all-time low against the euro.

Gold prices, meanwhile, are closing in on the $1,000 mark.

Both allow investors to hedge against inflation. But Andrew Gordon in Investor’s Daily Edge says gold is the better inflation hedge.

And gold ETF GLD is showing signs of a strong run up in price…

I blame high oil prices on gold.

Well, I’m not completely serious but I can’t help but feel that gold isn’t holding up its end of the bargain. Investors are dumping their money into oil because nothing else is going up – including gold. That’s a bit strange. Gold loves uncertainty and uncertainty loves gold.

But gold usually takes the summer off. I thought if there was ever to be an exception, this summer would be it. Gold is a better hedge than oil against inflation. Ultimately, oil pays attention to its own fundamentals. For example, oil imports for the month of May dropped over 10 percent in the U.S. If other countries follow suit (that’s a big “if”), oil will drop. Gold’s value stands apart from what is happening in any market or any country. It is the ultimate hedge against inflation or recession or wars or natural disasters or mass bailouts. All of these are on the table as practical (not just theoretical) concerns. Some are happening already.

It’s gold’s time. Its summer hiatus is over. And it’s already started to make its move up the charts.

The ETF GLD (which tracks the price of gold) has been trending sideways since March. But its 20-day moving average crossed above its 50-day at the beginning of July – a very bullish sign. And on Friday, GLD convincingly broke through its previous resistance with strong volume. Gold for August delivery ended the day at $960.60 an ounce – up $18.60 for the day.

Back in 2005, gold made its move a little early – in July. Looks like history is about to repeat itself.

Source: Summer Gold