Gold Price - Where is it heading?

[explod]

I hope you a right.

Dont' take my word for it. Check out "Financial Armageddon" Michael Panzer, Kaplan Publishing, 2007; and "Conquer The Crash" Robert Prechter Jr. Wiley, 2002. In fact the latter called it a few years early but on how it has played out he has been spot on.

If you cannot be bothered checking out the texts (but the discerning investor should, and I have no association with publishers etc.) check the website. <www.financialarmageddon.com> from there you will find others.

Everyone, do yourselves a favour and be informed.

 

[CamKawa]

Anyone here buy any gold over the last couple of days? What were your reasons?

 

[CamKawa]

Yep, generally the markets will not recover. I look at 2008 as 1929 and the markets kept going down for 3 years. Financial mess appears even worse this time.

I’m all for the price of gold going up but we haven't even hit a technical bear market yet, so I think this is a big call.

Thanks for the book referral.

 

[Uncle Festivus]

The meltdown continues tonight with index futures down again & gold is not immune from the contagion, currently down to $872. My golds got smashed today in the fallout. Only redeeming factor is the Aussie dollar is tanking as well keeping Aus gold above $1k . Deja vu?

 

[barrett]

I'm in two minds about the price. On one hand the price of oil looks like it's on the up but on the other maybe the central banks are keeping gold in the 870 - 890 range while the crisis is on.

I also have the concern that as soon as the market starts to recover the flight-to-quality factor that gold has becomes less important and the price will fall. Anyone have any comments on that?

re the stockmarket, gold doesn't mind much what it does.. sometimes they move in tandem like now, but the link isn't causative.

What really drives gold bull markets is
accelerating consumer price inflation,
combined with
falling or declining interest rates, or other form of acceleration in money supply.

Under these conditions the increased money supply aggravates the consumer price inflation problem and gold is one of the only assets that benefits.

So gold will perform better the harder the Fed cuts rates because of the credit crisis.

On the inflation front, outgoing Chicago Fed head Michael Moskow made a very interesting comment soon before he retired early last year.. I have tried to retrieve the article several times but I can't.. he said the best single forward predictor of the US CPI is the price of wheat, with about a 12-18 month lead time..

CBOT Wheat, 2006-07

 

[MS+Tradesim]

What's with POG? Kitco has it down 11% tonite.

 

[numbercruncher]

My prediction on Gold in this thread a few pages back was that it wasnt going down unless everything else was coming with it, seems everything is coming with it !

 

[Real1ty]

With oil off about 2% and the $ firming theres been selling pressure on Gold for hours now.

I shorted it @ 877.30 but got out a bit too early, needed more guts, but a profit is a profit.

It's bounced now from a bottom of around 867 and is currently at 872.

 

[barrett]

There goes my rounding bottom theory lol :flush: whoosh..
c looking like a classic impulse wave unfolding.. so far..
Kauri's a=c sounding good, target ~850 if it can break through 38.2 fibo at 864.50

speaking of Herald Sun articles, just saw this one..
http://www.news.com.au/heraldsun/story/0,21985,23063707-662,00.html
"Business at Australia's "gold bank", the Perth Mint, has jumped by about 50 per cent in the past six months. "
"Manager Cathy Anza said 75 per cent of sales in the past month have been to first-time investors. " ...these figures always come out afterwards! I guess the new passengers have to have their trial by fire.

Curiously, Gartman reports that some substantial ETF drawdowns occurred last week.. Nearly 23tonnes of gold came out of GLD ETF alone. Gartman remains very long because gold is still holding up well in terms of many currencies other than $US.. so far holding E600, A1000, C900 levels

 

[BREND]

With oil off about 2% and the $ firming theres been selling pressure on Gold for hours now.

I shorted it @ 877.30 but got out a bit too early, needed more guts, but a profit is a profit.

It's bounced now from a bottom of around 867 and is currently at 872.

I also intend to short gold, already shorted Comex silver at US$15.89, now is US$15.65.

 

[explod]

What's with POG? Kitco has it down 11% tonite.

Yeb, it worked in well with the s/m drop and the us holiday. Last Thanksgiving (and the one where the kids wear hats) on Mondays they dropped it too. De seppo PPT having a good time and will now buy into selling up till Wed., then we will see.

Could get to as low as $US840 alright.

 

[CamKawa]

So gold will perform better the harder the Fed cuts rates because of the credit crisis.

If our bearded friend does cut rates by .5% how much would you expect gold to rise and in what time frame?

 

[bean]

If our bearded friend does cut rates by .5% how much would you expect gold to rise and in what time frame?

Yes the bearded one...the one which the market has no confidence in.
He has between now and when the US markets open to pull a rabbit out of his hat...He needs a minimum .75% if not 1% between now and the opening he will and can't wait till the next FED meeting at the end of the month.

Time frame of rise in POG on that sort of rate cut most likely should be instant.

 

[Sean K]

He needs a minimum .75% if not 1% between now and the opening he will and can't wait till the next FED meeting at the end of the month.

Time frame of rise in POG on that sort of rate cut most likely should be instant.

I agree. .5 is factored in I reckon. It will depend on what he says also. If he's along the lines of continuing to lower rates then POG will likely head back to all time highs. If opposite, we might get your 540 bean

 

[Uncle Festivus]

I'm expecting Japanese style deflation in the US so anything less than zero % interest rates will be a disappointment, and the consequences on the $US, & then the gold price to react accordingly. The Yen carry trade is unwinding at an parabolic rate lately so it will be a market of he who has the less worse currency and economy to back it.

Human emotion is a funny thing, aus gold still at $1k yet goldies getting smacked around as well. Time for an entry in the OXR for the gold portfolio? Down 13% bottomed at 262.

 

[Kauri]

those little coily things often signify a 4th wave.. although I wouldnae try to fit a count on this... If it is a 4th wave then we are possibly still in WaveA of the correction??? Regardless... the trend is currently down and that is all that counts, so to speak...
Cheers
.........Kauri

 

[cuttlefish]

imo it seems unlikely that longer term gold price bull run is about to come to an end - its pretty rare for a significant index/market to broach new highs and then beat a full retreat. Once old historical highs are broached, they are usually smashed through at some stage - though whether thats next month or next year is another matter.

 

[Sean K]

imo it seems unlikely that longer term gold price bull run is about to come to an end - its pretty rare for a significant index/market to broach new highs and then beat a full retreat. Once old historical highs are broached, they are usually smashed through at some stage - though whether thats next month or next year is another matter.

If Bearded Ben doesn't lower rates at least 50 points it could be a very significant sell off...

 

[Uncle Festivus]

Looks like support has been tested and held at 855 for the moment. Will it range or break? US dollar dead cat bounce has run it's course (again!)?

The Uncle Ben's helicopter will be re-fueled mid air as there is much money to be distributed to the needy hedge funds, banks & brokers - 50 bps minimum is a certainty. Although, gold appears to be less & less inclined to be influenced by interest rates or the dollar - getting more "unhinged" so maybe start to trade on fear by itself.

 

[Uncle Festivus]

Interesting correlation between gold & oil. Either gold will match oil's volatility in percentage terms or the gold oil ratio will get back to historic value (around 16?), currently 9.7, meaning an oil price in the mid 50's?