Australian (ASX) Stock Market Forum

Gold Price - Where is it heading?

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explod, like I said in my original call, long with an eye to wave 5.

That means this is it. This will be the big wave up that will cause everyones daily oscillators to diverge bearishly and there will be an a-b-c correction after that.

Silver is still not rising. Light crude still under 80. Financials are regaining last weeks losses. If this is inflation I am a chicken.

PS: In dreamland do they have dictionaries? Hell, do you know where Zimbabwe is? Because what you described doesn't even come close to meeting the definition of inflation. You described stagflation, and in my opinion we aren't there yet and won't be for years to come.

How many times will I have to paste this link?
http://globaleconomicanalysis.blogspot.com/2008/12/humpty-dumpty-on-inflation.html

I am long here only so I feel safe going short higher up :)
 
moXJO said:
Finally broke the AUS $1200 mark
Click to expand...

:) Refiners have bumped there spread a tad...... Looks like something is in the mix.

As long as the dollar settles and the gold continues to push we will see another physical gold rush in this country.

Remember once the home owners grant finishes and interest rates continue to rise its going to change peoples view in the market.

Another dump in any major sector (like real estate or shares) will cause people to become very conservative with their investments/spending which can be only good news for gold.
 
Ageo said:
:) Refiners have bumped there spread a tad...... Looks like something is in the mix.

As long as the dollar settles and the gold continues to push we will see another physical gold rush in this country.

Remember once the home owners grant finishes and interest rates continue to rise its going to change peoples view in the market.

Another dump in any major sector (like real estate or shares) will cause people to become very conservative with their investments/spending which can be only good news for gold.
Click to expand...

I am not convinced by his arguments, he applies many examples in selective isolation and IMHO looks very much a supprter of the PPP

His last quote fits him well

'When I use a word,' Humpty Dumpty said, in a rather scornful tone,' it means just what I choose it to mean, neither more nor less.'

'The question is,' said Alice, 'whether you can make words mean so many different things.'

'The question is,' said Humpty Dumpty, 'which is to be master - that's all.'
Click to expand...

Most of the deflation of which he speaks has occurred, sure there will be some more to come as businesses without financial support crash further but to me the recent turn up in cash rates (only litle shoots yet), driven by lack of demand and particularly a lack of interst by the banks will soon see a big change in inflation rates.

In my very humble opinion of course.

cheers to the patient bugs

Only time will tell the real story.
 
explod said:
I am not convinced by his arguments, he applies many examples in selective isolation and IMHO looks very much a supprter of the PPP

His last quote fits him well



Most of the deflation of which he speaks has occurred, sure there will be some more to come as businesses without financial support crash further but to me the recent turn up in cash rates (only litle shoots yet), driven by lack of demand and particularly a lack of interst by the banks will soon see a big change in inflation rates.

In my very humble opinion of course.

cheers to the patient bugs

Only time will tell the real story.
Click to expand...

The patient bugs have barely made a dollar over this entire financial crisis if they live in Australia. Gold has to have been the dumbest investment for Aussie gold bugs to make. In fact this issue was clearly discussed several times in the January period on this thread, what happens if AUD starts to rise faster than gold?

I find it extremely amusing that you are claiming Australian cash rate increase is justification for your idea of global inflation. If only the RBA had that much juice.

This is a plain fact you cannot deny: being long XAU/AUD is the worst investment anyone could have made any time after Oct 08. Could have done better being long GS or JPM.
 

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sinner said:
explod,

How many times will I have to paste this link?
http://globaleconomicanalysis.blogspot.com/2008/12/humpty-dumpty-on-inflation.html

:)
Click to expand...

Well it seems to have been ignored by others, I had, but thought I would give you my humble opinion on it as you seemed to be looking for a response. Sorry it is not what you wanted.

There are many ways in which to leverage against the gold price, although the aussie gold price may be negative there is a lot of sentiment in gold stocks and swing trading some of them have been fabulous for me.

US gold is up 49% in the last 12 months and that has a big psychological impact.

However gold is only one sector in which I trade, energy stocks have also been very good to me.

My interest in gold is about wealth preservation and my own view that it is way under real value, inflation adjusted. A readjustment will in my view occur soon.

We will just have to wait and see, and sorry that you do not want to debate.
 
explod said:
Well it seems to have been ignored by others, I had, but thought I would give you my humble opinion on it as you seemed to be looking for a response. Sorry it is not what you wanted.

There are many ways in which to leverage against the gold price, although the aussie gold price may be negative there is a lot of sentiment in gold stocks and swing trading some of them have been fabulous for me.

US gold is up 49% in the last 12 months and that has a big psychological impact.

However gold is only one sector in which I trade, energy stocks have also been very good to me.

My interest in gold is about wealth preservation and my own view that it is way under real value, inflation adjusted. A readjustment will in my view occur soon.

We will just have to wait and see, and sorry that you do not want to debate.
Click to expand...

Pretty funny for someone who believes the financial world is coming to an end is still willing to buy stocks.
 
sinner said:
The patient bugs have barely made a dollar over this entire financial crisis if they live in Australia. Gold has to have been the dumbest investment for Aussie gold bugs to make. In fact this issue was clearly discussed several times in the January period on this thread, what happens if AUD starts to rise faster than gold?

I find it extremely amusing that you are claiming Australian cash rate increase is justification for your idea of global inflation. If only the RBA had that much juice.

This is a plain fact you cannot deny: being long XAU/AUD is the worst investment anyone could have made any time after Oct 08. Could have done better being long GS or JPM.
Click to expand...

Excuse me if I have misunderstood you and I did not read the thread in January when it was discussed.

If you were long on gold bullion directly or indirectly via the ETFs during the GFC, then you did a lot better than other asset classes in USD and gold bullion even rose to all time highs in other currencies including the AUD. During the crisis, the Australian gold ETF GOLD.AX made an all time high while most stocks were tanking and the price of gold bullion in AUD reached its all time high of approx. $1500 in February 09. This is easily verified by consulting the gold currency charts at kitco.

You are correct about the gold miners, they did fall a lot more than other asset classes due to many factors including their leverage to the gold price and their need for credit etc. This shows that investing in gold bullion and shares in gold miners are different investments and should not be conflated together.

Disclosure: I owned during the GFC and still own shares in GOLD.AX and would have made a lot of money had I chosen to sell in February 09.
 
sinner said:
Pretty funny for someone who believes the financial world is coming to an end is still willing to buy stocks.
Click to expand...


You are obviously on another wavelength. I do not think the financial world will end at all. On current methodology and value it is in for a servere correction. The powers that be will not like that and yes a risk in holding stocks in a lock down.

But then it depends on what stocks, when and holding timeframe. I for example did a good buy of OGC 2 days ago and got out today with a tidy 12%, if everything had locked down I feel confident on my own analysis that I would eventually get my value back and perhaps more in this stock. I rarely have more than two stocks in the market at one time and I watch the bejesus out of them from start to finish.

Hoving said that, the observant will be aware days before due to market behaviour when the big crash is niegh. On the start of the October crash I was totally out of my long positions within days. It was very evident for a week, by the charts and by the news.

I think gold will have a correction in the next few days, huge resistance building up and a correction down will strengthen that point.
 
sinner said:
Pretty funny for someone who believes the financial world is coming to an end is still willing to buy stocks.
Click to expand...

You know what is funny sinner? Gold is up 40% in 12 months.
Well fun for buyers during this time indeed.

The tier one capital ratios you have spoken about in the past and the recent writedowns of bad debts from ANZ and NAB. Now that is equally, if not more humourous IMO.

I don't believe the financial world is coming to an end, in the main it has colluded with big government in the US and UK to bail itself out. So no doubt it has survived and in part will survive. Gold man sucks (Turntables' previous employer) is now bigger than ever courtesy of this. Lloyd's has lost it's mantle as the largest merchant bank in Europe and RBS is still a basket case and has sold it's vast Asian assets.

So yeah, your right the financial world hasn't come to end and neither has the life support upon which many huge banks have survived. But the recipe that created this disaster hasn't changed one bit.

It's a whole new ball game out there now and no historical precedent exists as to the outcome (eg. QE, monetary stimulus, bailouts etc..) It is completely unchartered territory, nobody can claim to have a clue as to what will transpire. You could call it speculation, I call it bad ****ing news for the over-leveraged. I for one will not be dusting off the violin if there are more major bank failures for either the governments who have bailed them out or the finance (and I say finance as distinct from industrial capitalists who actually make things) capitalists they have rescued.

Of course within an Australian context, the regulatory framework governing banks is both sound and sensible. Aussies should thank Paul Keating for that, because this country's banks would probably be just as rooted as those in Europe and the US had M&A allowed foreign speculators to self-regulate the financial markets in Australia. Although Real Estate prices are in a bubble, and if the Real Estate crowd want to thump their chests about supply/demand arguments and lack of housing in Australia, well then the commodity bulls have every right to use the exact same argument. The Real Estate bugs can bow to Keynes and the gold bugs can look to Kondratiev in the hope that they are not laughed into a gulag. But there haven't been any handouts for the gold-bugs. But don't worry I'm not guts-aching over this. I'm glad because what I hold is mine and no third-party or blind intermediary can lease it, gamble it, short it or in anyway screw with it without my permit.

Remember this attempt to keep both the corpses alive ( Zombie banks) also happened in Japan about 3 decades ago. As I'm sure you are aware it has produced nothing but deflation as a result.

But I think the situation is entirely different for commodity producing countries with finite resources and double digit growth developing economies to sell the stuff.

Roubini said last night that $2000 oz Au within the next 10 years was utter nonsense. Well I think bailouts for the leveraged morons on Wall Street is diabolical nonsense.

So sit back and enjoy the party mate. Because it's not over yet by a long shot!


Also, I really enjoyed what Niall Ferguson had to recently.

Here's the link:

http://www.bloomberg.com/apps/news?pid=20601103&sid=aGbRse3KUmgU

All the best
DYOR
gumby
 
I know what sinner is trying to say as gold was sitting at around 1140AU for ages and just recently it broke through.

1200 seems to be the benchmark at the moment but with the weak USD its hard to say whats going to happen next.

But 1 thing i know if the AUD drops then we are going to see another frenzy like Feb this yr.
 
I must admit to knowing very little about gold, except that it is nice to look at and everyone wants to have some.

I have only ever bought physical gold and have bars buried here and there.

I have no idea where the price is going, but have noticed that when everyone thinks it is going to go up, it goes down , and vice versa.

Given our Foreign Policy at the moment, I like to keep gold for when the Taliban decide to come down the Bruce Highway, I'll stick it in me Burkah and go to the nearest airport.

It will always have some value.

gg
 
There's some great posts on this topic and some excellent technical and fundamental analysis. I would add that before you go into any investment you want it to be a high probability outcome. At the moment, gold fits that description. It's been well documented that gold is used as a hedge against inflation and the strength in the gold price is a sign of the support that many investors see global inflation as a high probability outcome.
With many governments across the globe still printing money in the form of currency or issuing treasury notes, it's not hard to see why so many currencies are falling in value.
When signs of the economic recovery comes to these countries (unless they go bankrupt first!) then we'll see inflation become more of a problem with increased prices, wages, etc. That's when I think gold will take off. Along the way there is going to be profit taking and rallies in the US dollar to cool the gold price but the trend has been and will remain UP for a long time to come. Time to get that metal detector out again.
 
Overhead resistance ahoy... might be an opportunity to trade out of my SGX now they are being taken over.

Interesting to notice the expanding range in this last few months' uptrend - I guess this would have encouraged Paul Tudor Jones (ref. Market Wizards) to take his recent large long position in gold:

“I have never been a gold bug,” Jones, whose company manages about $11.6 billion out of Greenwich, Connecticut, told investors in an Oct. 15 letter, a copy of which was obtained by Bloomberg News. “It is just an asset that, like everything else in life, has its time and place. And now is that time.”
http://www.bloomberg.com/apps/news?pid=20601014&sid=anNG9T__.c_M
http://seekingalpha.com/article/170...ervalued-and-bonds-are-a-curve-flattener-play

According to a financialsense.com interview last week, nearly all the gold newsletters have turned bearish, suggesting that many gold investors are on the sidelines in disbelief...
 

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Agree with the disbelief part lol. A gold bug last week was telling me how gold was gonna correct for a while before going to $5000 etc...
Gold has made 10 consecutive higher highs and higher lows. Once it breaks that we could see a retracement of sorts. Happy with my junior goldies in the meantime :)
 

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