I saw an interesting chart of gold adjusted for inflation (I don't know how to post charts)
When gold touched $3500 / oz this week it equalled the 1980 high (inflation adjusted).
In retrospect the market backed off $200 indicating some resistance there. The high made in 1980 was made on speculative frothiness due to 13% inflation. This gold bull market isn't based on an inflation scare in my view (currently at 2-3 percent). Also, it doesn't seem frothy currently. I've only seen one gold bull on CNBC and he was recommending gold mining stocks, which have greatly underperformed the metal.
Central banks are reportedly buying gold. Perhaps the status of the US dollar as the worlds reserve currency is in question now?
I have no strong opinion as to direction short term but 5-10% of ones assets allocated to gold seems prudent as a sort of financial disaster insurance policy. Land or Real estate might work just as well but gold coins are fairly liquid and can be easily transported.
Previous threads:
Gold ---- next---!!
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https://www.marketforum.com/forum/topic/111021/
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https://www.marketforum.com/forum/topic/110441/
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Thanks, joj!
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https://www.marketforum.com/forum/topic/109907/
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Started by cutworm - Nov. 29, 2023, 8:14 p.m. https://www.marketforum.com/forum/topic/100943/
I'm still trying to get it all together after the injury and catching up but doing WAY better than expected and appreciating some really basic things much more than before.
Thanks again, joj for starting a new VERY insightful thread on a popular topic here.
Was this finally THE top? Double top with 1980 dialing in inflation? Everybody predicting a top recently was wrong and blown out.
Mike had a great idea, shorting gold trade when some short term indicators flipped down, with the way overloaded longs vulnerable to a sharp spike lower(even if there was an issue with me on the timing/posting, it was actually smart trade recognized by a seasoned trader with great observation skills).
https://tradingeconomics.com/commodity/gold
1. 1 week MAJOR reversal down earlier this week. Spike to all time highs at psychological resistance of 3500, followed by a lower close that day. Reversals don't look more impressive than this one and it certainly caught the attention of the buy at any price trade mentality fueling the parabolic move higher. With the buying temporarily exhausted and the new mentality of profit taking and new shorts who were picking the top because of this powerful, technical topping formation. Regardless, the price actually stabilized the last 2 days and is NOT in a free fall yet.
2. 1 year-This weeks reversal down and lower price the next day is just a tiny blip
3. 10 years. This week's reversal lower day doesn't even show up
