I don’t even know where to start talking about gold, it defies belief that gold continues to plummet and is now making new 5 year lows at the same time as demand for the physical stuff is soaring and debt laden economies globally continue to debase their currencies and accumulate yet more debt to service their debt.
To believe some people gold is now heading not only sub $1000 but down to $700 or even $400 you name your low price and someone is predicting the bottom there.
Gold is manipulated by the biggest most powerful entities, this is strategic and to keep the fiat ponzi corrupt monetary system alive as long as possible. Is there anyone out there who can deny this with a straight face?
In fact I’m not really going to try and talk about gold manipulation any further but instead look at the charts, bearing in mind that the lines on the charts have most likely always been heavily influenced by periods of manipulation going through the ages.
Heres a chart showing 1 month candles.
I’d say it looks like gold may be heading to the bottom of this channel which I’ve marked, corresponding to a price will fall to about $1000. Look for the media to gleefully leap on it if it goes slightly below $1K. Will that be the final capitulation where the weak hands are finally shaken loose? If not then I guess gold will continue this miserable path down along this bear channel. But for how long can gold remain bearish? Is the economy really recovered? Is the Fed really really going to raise rates?
Looking back, the world came off the gold standard in 1971, which incidentally, when announced was supposed to be temporary although here we are stuck with it more than 40 years later.
(Funnily enough zero interest rate policy and QE is supposed to be temporary too in response to the financial crisis of 2008 but so far seem to be continuing quite merrily too.)
Heres a look at gold price over that period, again with 1 month candles, starting in 1971 through to today.
With the world moved away from gold to pure fiat, shortly after gold went on a huge bull run rising from $35 as investors realised the currency was now totally unbacked and therefore would not hold value. However in the mid to late 1970’s gold suffered a bear market. Eventually the bull came back for a second even bigger leg up to the top of the channel I’ve marked finally topping at about $850 (remember that’s valued in 1970’s dollars not todays dollars).
Could we be in the same place today as that time of the bear market in the mid 1970s? Obviously with my ‘You are here’ label, thats what I’m thinking in terms of, but of course this is only an idea I want to put out there. Target for this idea is gold to the approximate top of the channel and price of $10K.