Gold !

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.

12 thoughts on “Gold !

  1. Thanks for the update! I read that some institutions were selling assets like gold to get some cash back to cover some losses and that could explain the plummeting ..

    1. I agree that will account for a portion of it. There are definitely normal market forces at work here such as what you describe. In fact it looks like the global economy is in a depression of some sort despite media trying to paint another reality. Oil and many other commodities also are struggling.

      One of the reasons I don’t go into detailed speculation about price is to me it seems so complex and many other analysts do a much detailed and better job at it. But the impressions I get are that the real market forces trump any manipulation (eventually) but manipulation can maintain some lower price for a time, such as now.

      The media (controlled by only a few large corporations) is used as part of the weaponry for this aim alongside many other tactics. The massive shorts in the futures markets being another piece of it. If gold was really a commodity there is no way such large short positions would occur for miners hedging against future production being lower price. Again only my impressions but it seems shorting in futures market is purely a way to force the spot price down lower than it should be. I believe gold is not a commodity it is really money.

  2. How about I ride BTC to $13,000 later this year or next, then sell, then convert all of it to gold at still around $1,100 before riding that to $10,000?

      1. Yes despite being bullish gold (longer term) I’ve recently converted some gold to bitcoin, to one day trade some back into gold probably. Hopefully it works out well. I feel Gold’s mania phase is still probably a long way off compared to bitcoin’s next mania.

  3. You wrote “Gold is manipulated by the biggest most powerful entities”, you’re probably right but thoses entites don’t need to be so powerfull. 99% of the global population don’t care about that manipulation and are not able to weigh value of precious metals.

    Amazing illustration :

    For sure I do the same experiment down on my street, more than 75% go away with a chocolate bar.

    1. Crikey! Well the chocolate does look tasty I guess…

      I wonder if theres more to it, perhaps people are afraid of a hidden ‘catch’ and subconsciously unwilling to take something valuable for nothing prefering the chocolate for that reason. I don’t know really. Hopefully after that encounter some of them go away and find out more about silver.

      1. You would have to know the price of silver to know it’s more valuable. Unless you speculated on it, you wouldn’t know.

      2. I have plenty of college educated friends in high paying professions who wouldn’t know the price of silver or what to do with it. In turn, I know nothing about bitcoin mining because I’m not interested in making money that way. Knowing doesn’t make you smart, it just makes you a nerd.

  4. Silver is also a weird thing to possess. If in that experiment, you replaced silver with gold I bet you would get different results.

  5. Amazing to see you drew the exact chart with “you are here” as I did. I just found this website when I searched for my bitcointalk nick ‘findftp’ which you mentioned in another post.

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