Gold Price - Where is it heading?

[brerwallabi]

Re: GOLD Where is it heading

If your right then $640 Aus POG surely is on the cards and that means very good news for a few junior goldies here.

 

[reichstag911]

Re: GOLD Where is it heading

reich,

US$200? Some would consider that an extremely bullish outlook on world finances & the US$ in particular. Just wondering is that a chart based view or on fundamentals?

All based on TA - i don't do funny-mentals.

I am NOT bullish on world finances: there will be an implosion at some stage - just don't know when...

I called the impending USD rally in Nov 04 and am still USD bullish.

Cheers.

 

[reichstag911]

Re: GOLD Where is it heading

The fact that this gold thread exists and is so popular is an excellent contrarian confirmation that gold has topped for the move.
Trust me.

Similar with China - being spread all over the mainstream media this year.
It will pullback.

CRB commodities index chart is topping this year it seems. Just waiting for confirmation.

The corrupt fascist junta have ramped the U.S. market nicely since the massive bear market that started in 2000 - and may continue to do so for a long time before it can't prop it up anymore.

But that might not happen til next decade.
The PPT is alive and well and should never be underestimated.
USA will be fighting for its survival after all.

It will lose to Chindia but hey that's life !

My long term U.S. charts indicate that the DOW will prolly break down BIG TIME around 2012-2014: MAJOR BEAR PARTY TIME.

IF it's a deflationary depression - everything may get pulled down with it including PM's.

Tasty bear-fest coming up for later this year to 06/07 : )

It's a big wave 4 down for Australia.

XJO topped in March 05 which i called in March 05...
(posted it at newsgroup)


Cheers.

 

[Smurf1976]

Re: GOLD Where is it heading

...The corrupt fascist junta have ramped the U.S. market nicely since the massive bear market that started in 2000 - and may continue to do so for a long time before it can't prop it up anymore.

But that might not happen til next decade.
The PPT is alive and well and should never be underestimated.
USA will be fighting for its survival after all.

It will lose to Chindia but hey that's life !

My long term U.S. charts indicate that the DOW will prolly break down BIG TIME around 2012-2014: MAJOR BEAR PARTY TIME.

IF it's a deflationary depression - everything may get pulled down with it including PM's.

Tasty bear-fest coming up for later this year to 06/07 : )

It's a big wave 4 down for Australia.

XJO topped in March 05 which i called in March 05...
(posted it at newsgroup)


Cheers.

So let me get this right... You are saying that the XJO is headed down big time and that the top was in March this year but that the US markets may be propped up by the PPT?

Based on that it would make sense to short the XJO and keep well away from the US markets.

I agree with your post overall, China and the CRB etc, but am not convinced about the US bit. If they were going to prop the markets then wouldn't they have done so during 2000-2002? I am aware of the PPT but just wondering why they would act so forcefully now when they didn't last time?

Timing - you mention 06/07 - would that be October 2006 low by any chance? Just going by what I have read elsewhere on this subject as they all seem to mention Oct 06 but then they are talking mostly about the US markets.

A lot of questions I know but it looks like you are the person to ask...

 

[brerwallabi]

Re: GOLD Where is it heading

Is this the turnaround for gold now, starting to work its way back up, next week looks like the testing time, its being following oil closely lately so expect a big jump next week.
Could there be a gold boom?

 

[DTM]

Re: GOLD Where is it heading

Is this the turnaround for gold now, starting to work its way back up, next week looks like the testing time, its being following oil closely lately so expect a big jump next week.
Could there be a gold boom?

Looking at the charts, my thoughts are that oil is carrying on its up trend. I expect it to keep on rising in the short to medium term, so outlook for gold is bullish with US and Australian markets bearish.

Just my two bobs worth...

 

[Profitseeker]

Re: GOLD Where is it heading

Gold is on the retreat again but the bottoms are getting higher and higher. It should really start to test those resistance levels above USD400 in the next few months. (currently looking to break below 400).
Anyone out there still very bullish on gold? I'm hoping to get leverage via some of the smaller gold stocks.

RichKid

Very bullish. I am acquiring as many Gold stocks as I can. The big producers are not managing to renew their supplies of gold. Therefore in my books and according to the law of supply and demand 1) there will be further consolidation in the market 2) Gold prices will continue to go up 3) So will the price of gold shares.

 

[Smurf1976]

Re: GOLD Where is it heading

Bull markets tend to suffer a major setback at some point. For example the 1987 stock market crash or the gold plunge in the mid-1970's.

I have no hard evidence of it actually being in progress but looking at the general economic picture I do get the feeling that such a point may be upon us with the gold bull.

The credit boom seems to be slowing, housing is slowing or actually falling depending on location, bonds point towards a slowdown, US stocks are going nowhere. Just be careful.

 

[brerwallabi]

Re: GOLD Where is it heading

Gold still has a huge and increasing demand coming from Asia, as China and India develop the demand for gold will not be able to be met, these cultures value gold highly and with the newly created wealth in these countries this demand will soar.The US dollar will fall eventually and possibly soon, interests rates up to and $500 US is definately going to happen, I have read some journalists and some so called analysts spruiking gold at possibly upto $1000.Hmmm

 

[RichKid]

Re: GOLD Where is it heading

Gold has experience high volatility recently. Will it head down again to retest the upper reaches of the triangle, or on to new highs? No view personally yet, although last week I thought it'd retrace further, consolidate and then rally to 500.

....Just attached a daily chart, downtrend channel in last few weeks, lower lows, lower highs (so far).

 

[brerwallabi]

Re: GOLD Where is it heading?

Rich it seems currently to be heading north again, there are a few gold stocks that have fallen of late and this move might be a good sign for them. I hope this time it continues up to test $500 if it clears $475, its had a few cracks at this level recently to fall back, anything happening in the land of free this week that you know about that could drag it back?

 

[RichKid]

Re: GOLD Where is it heading?

Well gold has surprised, testing the recent highs, Wayne had some great info on COT data and graphs, can't recall in which thread it was posted atm but you'll find it on his blog.

Here's the weekly chart, nice long channel, if this isn't a monster uptrend I don't know what is, could easily fall back to retest the trendline or could challenge the recent highs and get on with it, or could fall back to retest that triangle from a few months ago. Seems to be all pointing to circa 440 as a great entry point, if it falls to that level.

Did I say this already? I'm bullish (but not for short term trades imo, wait and see, interesting to see how the chart compares to the fundamentals and the COT data). No fib levels, sorry, don't have the tool.

 

[wayneL]

Re: GOLD Where is it heading?

Latest available COT data

Comm's are nett short, but coming off lows, seems a short signal has not come off. So must mean long!

 

[RichKid]

Re: GOLD Where is it heading?

Latest available COT data

Comm's are nett short, but coming off lows, seems a short signal has not come off. So must mean long1

Hi Wayne,
Going by the COT data a quick pullback (back to about where that green line was recently) could see gold retest 440 and then get on with it, maybe I'm seeing what I want to see. Thanks for the great chart, very clear, I often get confused with COT data.

 

[Kauri]

Re: GOLD Where is it heading?

NEW YORK (MarketWatch) -- Gold futures ran up to an 18-year high Thursday, extending the double-digit gains seen in the previous session, while copper futures continued their march to all-time highs.

Gold for December delivery traded as high as $486.90 an ounce on the New York Mercantile Exchange and was last up $6.70 at $485.80.

The precious metal had surged $10.10 on Wednesday.

"Gold's move to $480 makes further near-term strength likely," said Morgan Stanley technical analyst Mark Newton, who sees a possible retest of the December 1987 highs near $500, then a move up to the $515 to $525 range.

Merrill Lynch technical analyst Dennis Mark believes the run-up in gold prices toward $500 will give the gold market a psychological boost, and continue propel gold stocks.

December copper tacked on 1.4 cents to a fresh all-time high of $1.949.

CS First Boston attributed the gains to continued speculation regarding China's potential large short position and its ability to export metal in order to cover.

The speculation surfaced after the Times of London reported on Tuesday that a Chinese copper dealer, who worked at the Chinese State Reserve Bureau, disappeared after selling an estimated $800 million worth of copper short. :rocketwho

 

[brerwallabi]

Re: GOLD Where is it heading?

Gold Where is it heading?
Answer $500 US before Xmas watch LHG and CMX fly today.

 

[wayneL]

Re: GOLD Where is it heading?

Gold Where is it heading?
Answer $500 US before Xmas watch LHG and CMX fly today.

It will be interesting what traders to with the $500 figure. It's a pretty important psychological level.

My guess is that either it'll be resistance, or they'll get excited and buy straight through it.

(hows that for hedging myself )

 

[RichKid]

Re: GOLD Where is it heading?

A comparison of bulls and bears.
Suggests a speculative jump to 500 in the near term and then a retracement, volatility no matter what happens so it'll be exciting for most- lots of emotion, gold does that to people.

Mining Weekly- News Today
http://www.miningweekly.co.za/min/news/today/?show=77663

Debate rages over sustainability of gold's assault on $500/oz


The gold price, which yesterday touched a near 18-year high of over $482/oz, appears to be continuing its steady assault on the magical $500/oz level, with bulls still outnumbering bears.

But analysts are mixed as to whether the march can be sustained.

T-SEC gold analyst Nick Goodwin takes a bearish stance, saying that hedge funds and speculators have pushed it to its current level, and that a sharp drop should not be discounted.

Speculative buying, which results in rapid upswings, could see selling at the top of the curve, without any buyers. As an example, Goodwin cites India, which buys a third of the world's gold. The market in India is driven by jewellery makers, who are loathe to buy at current levels.

So, argues Goodwin, the dynamics of supply and demand will see the price falling back sharply.

This situation is enhanced by the fact that these buyers also hold gold in reserve and India has a healthy scrap market.

For the full year, the World Gold Council expected demand from India to push up to 850 t, an increase of about 230 t on last year. Already, the first half of the year saw demand in India up 180 t year-on-year, but the second-half seems to be slowing down somewhat. However, as the jewellery makers evaporate from the market, the price will drop sharply - even though it may have been pushed to $500 - and shares will bear the brunt of this fall, as they tend to outrun the gold price.

Not so, says a bullish David Davis, gold analyst at Andisa Securities, in his paper 'The Future of Gold'. Davis predicts gold at $700/oz by the end of 2008 and, by the end of the decade he forecasts that the yellow-metal would have risen to $800/oz.

In the third quarter of the year, the yellow metal averaged $439,72, a 3% quarter-on-quarter increase.

By the end of next year, he says, gold will have marched to $600.

Davis bases his predictions on supply-and-demand dynamics, which are predicted to “undergo irreversible change, caused by a decline in global mine and Central Bank supply and increased demand from China and investment”.

Supply-and-demand factors could - on their own - “trigger a quantum upward charge in the gold price, enough to sustain a new dollar gold price equilibrium”.

And if this was not enough to push the price upwards, Davis argues that the US dollar will continue to underpin the price and push it further.

The reason for the price moving to stratospheric highs, says Davis, is that supply is falling behind demand and no substantial new reserves are being found to replace dying mines.

While not a new phenomenon, he says that this phenomenon has previously been hidden behind hedging and Reserve Bank sales.

But, this cannot happen ad infinitum and, when the turnaround comes, the gold price will move up rapidly.

With too little exploration, dwindling reserves, dying mines and shortened life-of-mine, Davis sees a recipe for gold's profitability into the future.

And then there is China; this red-hot economy is likely to keep growing its demand for commodities, although it has stabilised from its recent growth patterns. Despite this, the country is likely to double its economy in the next ten years.

Another bear is MD of Barclays Capital's Mining and Metals division, Gerard Holden. Speaking at an Absa Corporate and Merchant Bank resource breakfast this week he called the peak at current levels.

“In the case of gold, we believe that this price move will peak around current levels with a reduction back to $350 (an ounce to) $375 per ounce in the medium term.”

However, he did temper that statement with a warning: “Now I need to caution that an unexpected event which damages global economic growth or raises global tension would impact upon these price outlooks.”

Respected precious-metals observer Paul Walker, who leads Gold Fields Mineral Services, echoes Davis's sentiments that the gold price is sustainable.

In response to emailed questions, he tells Mining Weekly Online that the gold price will continue its march over $500, and this march is sustainable.

He adds, however, that a “lack of Indian demand at high prices will constrain the highs somewhat, as will higher scrap (prices)”.

He confirms that much of the volatility in the price is due to speculators.

Another dimension to the debate was added in the inaugural edition of the 'Yellow Book' released this month where Gary Mead looks at the outlook for gold over the next 12 to 18 months.

He says the greatest unknown is how far and for how long the hedge funds will be prepared to keep the current momentum going.

“What goes up eventually will come down; but it may go much higher and perhaps even break through $500 an ounce in 2006, before it does come down,” Mead writes, adding that he foresees an average 2006 price of $430 an ounce.

 

[RichKid]

Re: GOLD Where is it heading?

Brief article on Gold with cot charts and some simple TA, shows importance of 500 level, double the value of a double bottom some years ago at 250 and same level as a double top a few years before that: http://www.schaeffersresearch.com/members/services/gold/bgscommentary.aspx?ID=338

The last gold chart I posted would show that gold has hit the upper boundary of that channel, so it either bounces downwards gradually in the opposite direction (circa 440/450) or it pullsback (as it has so far) and then spikes through the channel top- according to previous price action.

 

[brerwallabi]

Re: GOLD Where is it heading?

The last gold chart I posted would show that gold has hit the upper boundary of that channel, so it either bounces downwards gradually in the opposite direction (circa 440/450) or it pullsback (as it has so far) and then spikes through the channel top- according to previous price action.

Rich your starting to sound like a chartist lol, I hope your interpretation of spiking through the channel top is the correct analysis of the current gold chart.