Gold Price - Where is it heading?

[barrett]

Charts like that have been posted previously and to be honest I don't think they hold much weight due to the fact that that was the POG going up when the whole market was in bull territory. The world has now changed and what I think the POG is now pondering is will it continue it's bull run now that it's surrounded by bears? Oh and I'm also asking it to outrun the rising AUD to boot.

How do you define 'bull territory'? I thought that chart defined it rather well..

 

[CamKawa]

How do you define 'bull territory'? I thought that chart defined it rather well..

The POG has been and is still technically in bull territory. My question is will it remain a bull given that it's tracked sideways in volatile trading over the last month? Is it about to change its mind and make like a bear over short term given that the context of the broader market has changed or will it decouple and head for 950?

To my mind pulling out a historic chart going back to green acre times (pre 2008) doesn’t hold a huge amount of weight given the significant shift in DOW/XAO sentiment.

Your thoughts?

 

[ithatheekret]

I'm in the 50/50 camp , would like to see a retest of the lower support channel to confirm a base move , lots of daily speculation moving it everywhere without real impetus yet . Funds will be back soon we hope , end of certain New Years etc.,
Once they have started to reshuffle for the year ahead , we could have some clear direction , lots of chips shots , and a few holes so far .

 

[CamKawa]

I'm in the 50/50 camp...

Let’s look at the factors for a rise in the POG
1. Platinum is going gangbusters
2. Silver is strong
3. Oil is back above 95
4. Declining USD
5. Flight-to-quality
6. BB may cut rates further - March 18

The case against
1. Flight-to-cash
2. PPT intervention
3. Physical buyers suspected to be leaving the market
4. Investors are moving to silver as a cheaper investment vehicle
5. Possible IMF sell off
6. Higher volumes of scrap have entered the market
7. Stevo here at our end will raise rates negating any POG gains
8. It's a bear market (the vibe)

...lots of chips shots , and a few holes so far .

I agree.

 

[So_Cynical]

Let’s look at the factors for a rise in the POG
1. Platinum is going gangbusters
2. Silver is strong
3. Oil is back above 95
4. Declining USD
5. Flight-to-quality
6. BB may cut rates further - March 18

7. Seven year up trend...with trend line getting steeper every year.
8. World production flatlineing/trending sideways.

 

[Temjin]

4. Declining USD

Replace it with

4. Declining confidence in global fiat money.

9. Increasing interest as an investment through ETFs/ETCs.


As for bear case

9. Continue price manipulation from central banks and the "boys".

 

[explod]

The POG has been and is still technically in bull territory. My question is will it remain a bull given that it's tracked sideways in volatile trading over the last month? Is it about to change its mind and make like a bear over short term given that the context of the broader market has changed or will it decouple and head for 950?

To my mind pulling out a historic chart going back to green acre times (pre 2008) doesn’t hold a huge amount of weight given the significant shift in DOW/XAO sentiment.

Your thoughts?

Just in the last 6 months it has tracked sideway twice but it continues on. It is interesting when one becomes too focused on the expectation of continued rise we become concerned at any consolidation.

The primary reason for golds value is that paper money, as a piece of paper, has none, it is merely a statutory promise(iou) to make good its value. Inflation/cost of living etc., eats the value away but not gold. A look at the last six months shows gold steaming up strongly.

The economics in the US are based on debt, the dollar as a result has diminishing value so the only alternative as an abstract form of exchange is gold.

 

[Whiskers]

Let’s look at the factors for a rise in the POG.

How about more states of South America and Africa closing out western, particularly US miners (and oilers) over wage, royalty, excessive profits and pollution issues.

I can imagine more of this happening quite easily as these countries become more resentful of certain western politicans and decide to hoard their resources for themselves a bit like China is doing.

Enviornmental issues are already delaying big projects even in Alaska for example.

That would lead to a significant short to medium term shortfall of Gold, PGE's and copper.

 

[ithatheekret]

Yes , I agree with all those points , but I'm thinking short term only . Until March I expect sideways movements . The end of the Asian traders new year I see as important . Will they send POG down for a retest , which in my books would be great . I believe it would see the lower supports get up close then a retracement . That's healthy . I never underestimate Asian traders , they are very savvy , sophisticated investors and wield hefty wallets .

I think they 'll drop it back a tad , and we see it chip up for a new higher low , that would also give some technical confirmation .

Market manipulation , well it's everywhere everyday . I still trade within my parameters .

To plagiarize Nick again , " plan the trade , trade the plan " . PERIOD .

You don't rush in if at all possible and if you do it better be at the start of a run up or down and have a good reason , it's better to wait for the trade to come to you if you can .

I can't plan a $3 - $8 trade on a $900 asset , I'm after 10% + ... not 1% .

If I see chaos trading I want in cheap , it's got a very high beta . If I'm going to play in a high beta sandbox , I want Asian traders behind me , following me in or visa versa . They usually can smell what NY is going to do .

The new X factor for gold as I see it , is Dubai ............

 

[barrett]

Great analysis on here this weekend..

Just noticing that on Friday's close there was this breakdown below the 2-month support line, below in green, touched 4 times. Second chart is a closeup of this and the pullback. Left to my own devices I'd call this a significant breakdown. But I haven't seen it mentioned in any commentaries, and the market can't have thought much of it because volume was very ordinary. So while (to me) it sticks out like dogs b... on the chart, I'm unsure of the significance Any opinions?

A second possibility is that an interim bottom was formed at 896 on Friday night on the lower boundary of the red symmetrical wedge, ahead of a rebound off this level.

A third possibility is that this red wedge is broken also, then support is found at the blue trendline in the third graph, which Itha and Camkawa pointed out.. I think that's the 892 one?

Any opinions on the possible 'breakdown' below would be great.. cheers

 

[Temjin]

Market manipulation , well it's everywhere everyday . I still trade within my parameters .

Market manipulation for the gold and silver markets are alot different than one would believe a "normal' manipulation be.

There are reasons why world central banks HATE gold and silver.

 

[ithatheekret]

Banks and thinking are a tunnel on their own . The latest events only prove they can err better than the best of us . Interesting moving average crossings ...............

 

[explod]

Market manipulation for the gold and silver markets are alot different than one would believe a "normal' manipulation be.

There are reasons why world central banks HATE gold and silver.

All true, but they are losing their battle. Reading the Privatee over the weekend regarding the threat of IMF sales. All past attempts have failed and the very act indicates a panic that is picked up by the market.

On looking at the daily chart over the last few months and the action already today I would not be suprised to see gold have a crack at the US$940/50 area this week.

Some big reports due out of Wall Street too. Could be more fireworks.

 

[CamKawa]

Some big reports due out of Wall Street too. Could be more fireworks.

There's the Consumer price index which is forecast to come in at 0.3% and Core CPI which is forecast to come in at 0.2%. These figures will come out Wednesday in the US of A, Thursday morning our time.

 

[ithatheekret]

Another interesting MA crossing . hands up all you heretics that have been buying

 

[barrett]

Yeah another uptrend forming here in the yellow, here on the hourly, and a junction. A break to the upside would seem more consistent with the fundamentals at the moment, with Europe likely to cut rates sometime soon given the change in Trichet's language.. even though it may cause the US dollar to rally, would be overall a big plus for gold. Every day gold stays at these levels makes a signficant pullback less certain. At this point I think I would buy an upside breakout from this formation especially if volume picks up.

 

[barrett]

hmmm a breakout but on fairly low volume, anyone else trading this one>?

 

[explod]

hmmm a breakout but on fairly low volume, anyone else trading this one>?

Yep, never off it, long term is the best play on gold in my humble view. Notice Bernanke saying that a falling US dollar is good for the current situation. That in itself will push gold up.

 

[ithatheekret]

Getting there , I can see the winces already ..........

 

[ithatheekret]

this is going to get busy methinks ...............