Australian (ASX) Stock Market Forum

Gold Price - Where is it heading?

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The USD keeps ascending on the back of the euro. Or, in other words, it's the least worst.The US S & P looks ripe for a head and shoulders tumble. If it tumbles more safe haven will find its way into the USD. None of this bodes well for gold.

Throw the RSPT on top of this and, if you still believe in a gold investment, an exploreco or producer outside of Australia seems a better bet. (I like W. Africa.)

Personally, I have no intention of stading in front of the southbound Euro Express, or northbound USD. My thought is to sell into a relief rally if such a rally comes about -- perhaps a right shoulder?

If the H & S in the S & P pattern breaks bullish I hold, if it starts to look real I'm playing defense.

SX
 
Gold continues to gain strength in the face of growing uncertainties on the weaker fundamentals of soveriegn states around the globe.

To me gold or silver in physical form is not a trade but a longer term investment as part (30% for me) of a portfolio to afford some protection against the possible collapse of paper currencies. With such collapse will follow equity markets also. Some would say this is occuring as we speak.

However it is gold and its continuing bull trend that is of interest to us here. The following point and figure chart, with permission of the Privateer newsletter gives a good grasp of the gold bull:

http://www.the-privateer.com/chart/gold-pf.html

Other than being a subscriber I have no other association with the Privateer.

The Privateer http:www.the-privateer.com capt@the-privateer.com reproduced with permission
Click to expand...
 
I'm still bullish in the short term explod, but going back to the end of 08, my controversial count at the time suggested a larger degree diag triangle forming based on an Expanded Flat as the first wave of the uptrend.

At the time I was thinking $1,200ish, but as time and the chart has progressed my target changed to $1,300ish max for this uptrend before a significant period of correction or sideways movement.

You might also notice on that P&F chart a H&S around the $1,000 mark, which also suggests a top about $1,300.
 

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explod said:
Gold continues to gain strength in the face of growing uncertainties on the weaker fundamentals of soveriegn states around the globe.
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I disagree. This latest upmove seems to me that gold is showing weakness - not strength. A gain in price does not equal a gain in strength. 1252 if not the high is very close to it.
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To me gold or silver in physical form is not a trade but a longer term investment as part (30% for me) of a portfolio to afford some protection against the possible collapse of paper currencies. With such collapse will follow equity markets also. Some would say this is occuring as we speak.
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The good thing about a collapse in say, the price of AUD is that generally we will still make a profit buying gold priced in USD in this sort of environ.
 
sinner said:
I disagree. This latest upmove seems to me that gold is showing weakness - not strength. A gain in price does not equal a gain in strength. 1252 if not the high is very close to it.
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The good thing about a collapse in say, the price of AUD is that generally we will still make a profit buying gold priced in USD in this sort of environ.
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You may well be correct sinner. However due to the spread, physical gold is not an investment for short term trades in my view. I therefore look at the larger picture and without too much detail it is clear enough in the attached five year kitko chart.

Charts are of course one thing only. As the US continues to go down the path of printing new unbacked paper money for its survival I believe the current US$ rally mayl end soon with a rather large drop. Although we still have our problems in Australia we are far ahead of the pack in resources and the ability to feed and clothe ourselves from within. That is going to count a great deal in my view over the decade to come.

Gold is in record territory (and has been for a month or so) against the Euro, the UK pound and some others. The noise being made by the US press has so far succeeded as a facade to the same monetary problems of the "PIGGS" et al. but there are signs that this is wearing thin. This is evident by some of the bigger financial speakers in the US now proclaiming that holding gold may be required to protect ones portfolio. In the last month or so others and myself have mentioned these in posts on this and other threads.

Gold, as has been normal in the bull run, hits resistance for a week or two at particular points, and we would expect it here where it equals the old high. Its larger declines have come when it has travelled to far to quick. This is not the case of late, we have seen a steady climb with steps of consolidation since February this year. I believe the current run up is far from exhausted.

However we will soon see as anything can and does happen.

cheers explod
 
It would be much better to have attached the chart to the last post, so here goes
 

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Gold is going up.

It is now a trade/hedge against the Euro.

What factors may bring gold down?
1) Coordinated central bank intervention to prop up the Euro, viz. SNB already (Swiss), ECB, Fed, BOJ...
2) the S&P 500 crashing requiring fund managers to sell their winners to meet margin calls, ETF GLD liquidation, rent money, etc.
3) Gold going up alone compared to the other commodities makes it a tall poppy ripe for harvesting.

It will make for an interesting June, July, leading up to gold's normal period of seasonal strength.

Still buying Aussie stocks having mines/properties OUTSIDE of the dreaded RSPT Zone, ie. no mine in Australia.

SX
 
The sure and steady rise in steps from February continues. With losing confidence in paper money growing by the day we can expect this rise to continue in the months ahead. As I stated last week, a very sudden and large spike up is the danger to look for. Trader Dan's take from overnight is well worth a look to those interested, part of it herewith:

Gold shot up to a brand new record high in US Dollar terms in today’s session as it continues moving higher on its own merits. It did not especially matter what the Euro or the Dollar seemed to be doing today as both were rather quiet compared to recent volatility that has marked those pits; nevertheless, gold powered through the capping efforts of the banks at $1,250 on good volume forcing some of the fresh shorts encouraged by some CTA’s and other advisory newsletters out of the market. It would seem that gold is becoming a star in its own right as crude oil was tame today as was the bond market and the equity markets. In other words, the typical “outside influences” were missing that tend to impact gold leaving the larger macroeconomic forces the main factor in gold’s performance. Clearly investors who have deep misgivings about the current state of the global economy, particularly the West and its increasingly unsustainable burden of indebtedness, want to own the metal.
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Taken from JSMinset today, for full report of Dan"s see:

http://jsmineset.com/
 
RSI has not confirmed this latest high, meaning a lack of momentum to push higher. But that seems to be the only fly in the ointment.

I'm hoping that this momentum weakness coupled with the June contract rolling over later this month provides a dip so I can buy one or two ASX exploreco equities.

SX
 
Southern X said:
RSI has not confirmed this latest high, meaning a lack of momentum to push higher. But that seems to be the only fly in the ointment.

I'm hoping that this momentum weakness coupled with the June contract rolling over later this month provides a dip so I can buy one or two ASX exploreco equities.

SX
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Gold is different and in this bull since 2000 such indicators are pretty useless. The Yaun being floated will be the death knell to the US$, gold is going to fly from here. IMVHO

The Aussie gold price may not rise a great deal through this dust up, but think about the wonderful overseas trip you can plan.
 
GOLD 21 JUNE 2010:

Gold is braking the green resistance line, so we could see a considerable rise in this precious metal price...
 

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The bears were in charge yesterday... could it have something to do with the contract expiring 25 June?

I think it does.

Now I'll be watching the mother of photo-ops being done in Toronto vis-a-vis the gold price, and boldly predict gold will move sideways and down until the June expiration. If this goes to plan (it never does) I'll be buying either, I hope, powerful exploreco or near-term producer.

SX
 
In the short term I'm not too sure, but perhaps slightly bullish on gold. Uncertainty leads to safe haven... etc etc, the familiar stuff.

In the long term I am extremely bearish on gold. One day people will realise that you can't eat gold, you can't drive a gold-powered vehicle, you can't build stuff with gold (okay, you can, but you'd be a moron). Gold does have some practical value (it's inert so you can make tiny stuff out of it, gold leaf, etc, but there are cheaper alternatives for most of its applications, and there's not a large quantity of physical gold in microscopic applications, which is its main practical use... microscopic amounts, often literally - nothing compared to the amount of gold we wear as trinkets) but since most gold is just sitting around stockpiled, it clearly doesn't have as much practical value as it does artificial value. When push comes to shove, people are going to want something useful rather than something of pretend value. We won't know the practical value of gold until gold is being used rather than put away in storage or worn as shiny trinkets on the fingers and necks of women.

Anyone familiar with diamonds? Very similar thing. Resource with a few practical applications (drill tips etc) but in massive abundance relative to practical requirements, so it only carries artificial value and is primarily stockpiled or used to make trinkets with similarly artificial value. It's strange that people only seem to realise that with diamonds (though strangely, people still pay for diamonds, regardless of their understanding of the ridiculous situation).
 

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