This is a mobile optimized page that loads fast, if you want to load the real page, click this text.

Gold Price - Where is it heading?

Jump to new

You took the word right out of my mouth
 
Currently out of gold stocks but have been very tempted to get into LGL the last few days.

I am stopped by the precarious and volatile currencies and markets. It has become clear that gold stocks are sold off heavily when the markets fall and the trend is down at this time. The US dollar is holding up very strongly which is also supressing the gold price. This could change quickly but have noticed the Comex period of trade puts gold down hard at these times too.

The Dow has been moving lower the last week on the daily and is approaching the low of November last year under which there is little support for it till 4000. This critical point could be reached when the new US President is sworn in next week. A large collapse will be a wipeout to all stocks in my view.

Interesting times but one for caution IMHO
 
Explod, I think gold equities are actually leading gold for once. They are a fair way higher (at least the ones I track) than the lows back in November. The worry for me is that gold is looking too correlated to the Dow for some reason, even to the tick. But I also sense some resilience and support for gold equities so it will be interesting to see how much collateral damage the goldies have when the next pleb shares sell off gets under way?
 
Action is still stuck in a Broadening Wedge
 

Attachments

  • Golden Trumpet.gif
    10.9 KB · Views: 1
Uncle Festivus said:
Explod, I think gold equities are actually leading gold for once. They are a fair way higher (at least the ones I track) than the lows back in November.
Click to expand...

Every single producer has bounced at least 50% ~ some were over 100%
(2 weeks ago) up off there Oct-Nov lows....even OGC has bounced at last.
 

hi Explod. are you suggesting that there will be a large collapse of the Dow when the new president is sworn in? isn't the general concensus that the market will be optimistic & firming, for a while at least? I do believe that you are being unduly pessimistic.

I understand the reasoning, just finding it hard to share the conclusions. the following is out of Gold World, they would be on your side.
.................................
<< Not only is January 20th the day the 44th U.S. President gets sworn into the White House -- it's also the day that a record-breaking stimulus bill starts pumping its way through congress.

The estimated $850 billion worth of Monopoly money they want to dish out to Americans on a single day is more money than the government spends in an entire year.

When the bill passes -- topped with bailouts to virtually everyone filling out a form -- the U.S. dollar will experience its largest drop in decades...

... Which will in turn crank the price of gold to historic new levels.

And for investors who loaded up in the precious metal before the spike... Well, they're awaiting what could be the single largest payday of their lives. >>
.....................................

my own interpretation is this: for the price of gold to crank to historic new levels, would first require massive collapse of the USDollar ... we're all agreed on that. the question then arises, will the enormous bailouts cause such a collapse? somehow, I feel that the new team would have already got plans in place to prevent such a disaster. they'd be irresponsible not to!

you are saying: "A large collapse will be a wipeout to all stocks in my view." sparing nothing, gold stocks included. we've seen that happening in the past. but myself, still inclined to see a wave of optimism ahead. based on dreams, maybe? the american dream. too early to say. we'll know in a few days time.
 
let me just add that in Money & Markets, Jack Crooks offers ...

"... a sure argument for why the U.S. dollar is in a position to appreciate ... despite the global recession."

if he's right, one would imagine that its goodbye gold. check it out at: MONEYANDMARKETS »
Saturday, January 17, 2009
 
I am not so sure about USD collapse at this point.

Banks are getting huge amounts of TARP money and Fed Fund Rate 0-0.5% money and parking it ALL in long yield Treasuries for 2-3%.

As long as this demand keeps up (and frankly why would it stop at this point) USD will stay high. The amount of Fed Fund Rate money in the banks is huge, tens of trillions $850b will not even be a drop in that pond.

The high for all currencies against the USD (incl Gold) was clearly when AUD was at 0.97 and Gold at 1000.

Banks all over the world used to invest long gold and oil short USD. I think we will now see a reversal of this long term trend with strong USD for plenty of time to come.

I am still a rabid fan of gold despite all this, I think it will remain strong regardless of USD strength due to its own fundamental reasons and people will no longer have the misconception of the dollar as the anti-gold. Current international physical gold demand indicates I am not the only one.

Anyone watching the forex markets closely can see that demand for gold during sans New York open hours is high, these markets are happy for their US counterparts in NY to drive down the price so they can gobble it up!
 

On this note I am hoping a fundamental divergence in gold stocks from others now which gives me optimism but explods opinion is nigglingly right to me.

Institutional investors have abandoned most/all of their gold miner stock longs. You can see this in some anns for IGR or similar companies. The price rally in gold miners since then has (I hope and guess) steady hands with a long term outlook. They are not planning on getting out. Spurts of activity on usually very low volume exchange traded options for these miners hopefully confirms this theory.

I doubt these instos will reinvest in the same companies if anything at all. This year clients will be happy with no losses rather than high yield.

We have already seen a few examples of this divergence, since October, on days where indices are way down, gold price is not looking steady, but gold miners held their own or even gained some. Lots of charts look promising for gold miners end of a very long term low! I am inclined to believe this could be the end of a cyclical low. Shares are never worth nothing, the lowest price is 0.001

To put it simply, this is what I am banking on, but recognise explods possibility as very real too and have not invested anything I am unwilling to lose (that's what physical gold is for ).
 
sinner said:
On this note I am hoping a fundamental divergence in gold stocks from others now which gives me optimism but explods opinion is nigglingly right to me.
Click to expand...


I am thinking more of the short to medium term here. Sentiment will gradually change but at the moment the big picture financial wizzes are talking up bonds as a safe haven (forget the low yields mind) I think the Commercial Bonds will also fail down the track but it is sentiment of the herd that rules now. Staying in cash and pysical is still for me but the next few days will tell us a great deal.

On the bigger state of things for gold the following figures coutesy "the Privateer" newsletter, are worth some contemplation.

"gold March 2002 US$302 in January 2009 US$839 plus 177%

Dow March 2002 10427 now 8281 minus 20%"

Gold may not pay any interest but has been a good hedge. In the same period the US$ index has dropped 28% also. Put it all together and it is indeed food for thought.
 

You are right friend the data you have provided are very true. At present most of the people are not able to predict were gold heading and what is going to be the future of Gold in coming times will it be plus or minus.
 
She's gone para again.

15m XAUUSD :
 

Attachments

  • xauusd.jpg
    43 KB · Views: 0
BentRod said:
She's gone para again.

15m XAUUSD :
Click to expand...

Cheers Bent

Yeah should do well especially when you consider the St Louis Fed Monetary Chart (generations to come TO repay) of Jan 08 2009 posted earlier. Inflation is a monetary event yet to be FELT! Sorry just had to add some SNAG commentary there!

Ohhh! I FEEL so cozy!! utthedoor:
 
strange move that, the DX is at channel R now....is it playing catch up?

CanOz
 
I wasn't expecting this move up at least until after the inauguration.

I guess people have realized that "obama magik" wont work.
Are B-runs a possibility?
 
You must log in or register to reply here.

Similar threads

M
Investing in Gold
3 4 5
Replies
81
Views
12K
qldfrog
SGD - Siguiri Gold Corp.
Replies
1
Views
772
Dona Ferentes
GMIN - G Mining Ventures Corp. (TSX)
Replies
1
Views
539
mullokintyre
US Election 2024 : Stock and Economic Comment
7 8 9
Replies
171
Views
10K
divs4ever
  • Sticky
Resources Rising Stars 2024 Conference Gold Coast
Replies
7
Views
2K
Garpal Gumnut
Menu
Log in
Register
Cookies are required to use this site. You must accept them to continue using the site. Learn more...