Gold Price - Where is it heading?

[Sdajii]

I agree with your sentiments. Also if gold goes to $3000 from $2700 or $2750 which is where FOMO for most will kick in it is only an 8-12% gain which is not as much as we have been used to trading gold on the correct winning side. So it is worthwhile keeping it realistic and remembering the risk v gain equation should this be a plan. I'm not inclined to buy higher atm I must admit but will be interested on a retracement. But then so will everyone else and his dogs. !!!

gg

Haha, you're right about everyone man, his dog, and his dog's fleas being keen to buy on a retrace, which is perhaps going to limit and retrace in the price. If this was a stock price chart I'd be expecting a significant retrace on the way, but this is gold, which is a different beast. Having said that, the different beast has some big players playing some heavy tactics, and every man's dog's fleas, while numerous, don't necessarily have enough capital to deploy to prevent some games from working, and additionally, a percentage of those fleas are fickle and as keen as they may be today, the idiot box may convince them to change their minds quite quickly, while the diehard bugs will already have their fill and don't have infinite funds to continue buying indefinitely.

I assume we both agree on the basic shape of the chart over the next 10 years, but we may not agree on how the next six months will look... well, difficult to disagree with me when I'm uncertain.

It's worth remembering that while gold is larger than small to medium cap ASX-listed companies, governments don't touch most of those companies. And, sure, there are mum and dad investors buying and trading gold in pretty much every country so they're far more numerous, but the governments of pretty much all countries also deal in gold, and governments play by different strategy playbooks from retail.

One good thing about your FOMO strategy of just buying is that in the long run you're definitely going to win on this one - you pretty much can't lose. Congratulations in advance on the appreciation of your gold purchase's value.

 

[rcw1]

Good morning
For mine, at the end of the day and when the dust settles, mid November 2024 presented a great opportunity to buy yellow. rcw1 failed to accumulate ... to bad how sad... should the PoG go back to around that US$2550 rcw1 will accumulate his holding and buy a much bigger safe ha ha ha ha ha

Have gobbed off about this little beauty, the horse may well have bolted...; some time ago and rcw1 will hafta reassess the benchmark to accumulate. Isn't the PoG fantastic, such a dynamic beast, most challenging indeed.

Have a very nice day today

Kind regards
rcw1

 

[rcw1]

Good evening
Article by Alex Gluyas for AFR 3pm 8 January 2025

State Street Global Advisors, one of the world’s largest investors, says gold prices could reach $US3100 an ounce this year, extending a 2024 rally that pushed the precious metal to its biggest annual gain in 14 years.

Bullion rallied 27 per cent last year and peaked at a record $US2778 an ounce in October, fuelled by robust central bank purchases, interest rate cuts by the Federal Reserve and safe-haven demand amid geopolitical tensions in Ukraine and the Middle East.

And the world’s fourth-largest asset manager believes those drivers remain intact this year despite indications from President-elect Donald Trump that his administration will enact policies to grow businesses faster, propelling the rally in riskier assets such as stocks and cryptocurrencies.
State Street, which manages a portfolio of $US4.73 trillion ($7.6 trillion), said there was heightened anxiety about a return of high inflation, ballooning government debt and worsening geopolitical tensions under a Trump administration. That would spur gold buying as a way to protect wealth.
“We don’t see this changing and expect the secular demand trends underpinning gold’s price and its status as a safe haven to continue enhancing gold’s appeal as a core portfolio asset, even if capital markets strike a risk-on tone in 2025,” State Street’s chief gold strategist George Milling-Stanley said.

While State Street’s base case is for gold to trade between $US2600 an ounce and $US2900 an ounce this year, it assigned a 30 per cent probability to its bullish scenario where the precious metal hits $US3100 an ounce.

State Street joins the chorus of Wall Street banks that are betting on another stellar year for the precious metal.

Bank of America, JPMorgan and Citi forecast bullion will reach $US3000 an ounce by the end of this year, and UBS forecasts $US2900 an ounce. While Goldman Sachs pushed out its projection this week, the broker still sees prices hitting $US3000 an ounce by mid-2026.

The bullish forecasts assume gold will jump more than 13 per cent this year from the current spot price of $US2649.38 an ounce.

A stronger US dollar has weighed on gold prices since the US election on November 5, but strategists underline the prospect of sweeping tariffs under Mr Trump which could exacerbate trade tensions and stunt global growth.


Gold received a further boost this week on news that China’s central bank expanded its gold reserves for a second month in December to 73.29 million fine troy ounces, from 72.96 million in the previous month. The People’s Bank of China resumed adding to its gold reserves in November following a six-month pause when prices hovered at record levels.

Local gold miners revealed this week that they ramped up output in the December quarter to capitalise on the boom in prices.

Gold Road Resources delivered record gold production from the Gruyere mine in Western Australia, Ramelius Resources boosted its output by 36 per cent compared to the September quarter, and Regis Resources lifted its production by nearly 10 per cent in the December quarter.

Golden opportunity​

But analysts are frustrated that gold stocks continue to lag the price of the precious metal; the spot price surged 27 per cent in 2024 but the New York Stock Exchange Arca Gold Miners Index climbed just 11 per cent.


VanEck believes the disconnect can be explained by a trend that has developed where the leverage of gold stocks to the metal’s price is weaker when gold prices are rising compared to when they are falling.

Indeed, gold prices fell 0.9 per cent from the end of 2023 to the end of February last year, while gold stocks sank 15.3 per cent. In contrast, from the end of February to October 22, gold was up 34.5 per cent, while the stocks surged 67.7 per cent. And from October 22 to the end of November, prices fell 3.9 per cent, but the shares of gold miners dropped by 14.8 per cent.

“We have been anecdotally making this observation, frustrated by the overly punitive impact this continues to have on the already oversold gold shares,” VanEck strategists said.

“We think this dichotomy represents a value opportunity for gold miners as they have been potentially oversold when the price of gold falls and under-bought when the gold price has been appreciating.

“They may be among the few equities not priced to perfection.”

 

[Garpal Gumnut]

Thanks @rcw1 and @Sdajii for your posts. they basically sum up the individual investor's viewpoint and mine here on ASF on this thread. Your chart @rcw1 is particularly interesting as it is not without the realms of possibility for the POG to retrace further to parallel the fall from late Oct to early November which puts us squarely on $2500. Buying more for me just above this level at $2510 is a no brainer.




As you said @Sdajii it is not just individual investors and Mums and Dads buying gold but whole countries and I would add geopolitical alliances such as Brics. the US is not an uninterested party with their ongoing lurch in maintaining the primacy of the $USD as the default Petro, Eurodollar and every other moiety of exchange expressed in $USD. Nothing ever happens in a vacuum nor just to one asset class. I'm expecting once Trump's ship of fools containing Elon, Vivek and the Bitcoin guy take over the public service for the dollar to appreciate. The Bronze loon also has a chance of mandating peace on anyone who appears to be a threat to the US, gaining Greenland and the Arctic from the 56,000 bogans who presently inhabit the joint.

So lotsa volatility and gold will be relatively under the radar while stocks, BTC and bonds will be closely watched for any further “Trump effect”. So gold could very well retrace.

gg

 

[rcw1]

G o l d is good. Hoping it has a very nice weekend
... Magic Millions tomorrow, now that is also good as gold ha ha ha ha $13750000 in prize money or 3,168.487490811386 ozs of gold or 98.56786271898195 Kgs of gold...
Wow.


Kind regards
rcw1