“And then, with the new year upon us and deteriorating economic conditions bringing even lower interest rates, both COMEX metals will rally in 2020Q1. At this time, I expect COMEX gold to reach toward $1650 and COMEX silver to trade above $20 sometime before Saint Patrick’s Day.”
USAGOLD note: Hemke offers some interesting analysis to back up his forecast at the link above.
Gold in six easy lessons
1. Don’t buy it because you need to make money; buy it to protect the money you already have.
2. Don’t look at price as a barrier; look at it as an incentive.
3. Don’t buy the paper pretenders; buy the real thing in the form of coins and bullion.
4. Don’t fall prey to glitzy TV ads; do your due diligence instead.
5. Don’t allow naysayers to divert your interest; allow yourself the right to protect your interests as you see fit.
6. Don’t forget the golden rule: Those who own the gold make the rules!
“The first thing to notice on the chart is that gold tends to go up quite strongly and with relatively little choppiness in the first two months of the year. This fits in quite well with the ‘January story’ but if you take a look at the end of the year, you will notice that the move up actually starts in December, not January, so it might be beneficial to consider a ‘December-February story.’”
USAGOLD note: A comprehensive looks at gold’s seasonality charts. . .Bottom line? Buy in November and December and go away. But sometimes the market refuses to follow the script. This year, for example, we skipped the annual summer doldrums. Gold went from roughly $1300 in early June to $1550 in early September.
Repost from 10-25-2019
“Modeling by Australia’s ANZ Research suggested gold could breach US$1,700 per ounce within six months, while London broker Bernstein is seeing the ‘remonetization of gold’ and the ‘weaponization’ of the U.S. dollar, which will ensure that central bank buying will continue for some time.”
USAGOLD note: We remain skeptical of the gold remonetization argument due to the complexities involved – particularly in the age of multiple trade wars. However, we do believe that central banks will continue to add metal to their holdings as a hedge.
Repost from 10-29-2019
Gold could go to $1800 to $2200 in the long run
A number of technical analysts have reverted to a more bearish forecast over the past few weeks with the $1250 area once again being touted as the downside support area. Many of those same technical analysts, though, have a significantly more positive outlook for the longer term. Among that group is Gary Wagner of the Wagner Financial Group who sees $1267 or even $1247 as possibilities in the short run, but also forecasts the possibility of $1800 to $2200 in the longer run. “Our research,” he explains in an article published recently at the Singapore Bullion Market Association website, “suggests that gold is in the final phase of a major long-term impulse cycle. This model also provides a look-back at the final major bullish wave could be traced back to end of 2015, following a correction to $1,040. This corrective fourth wave developed from the all-time high at $1,900 in 2011. The model suggests that gold could re-test the record highs that, if taken out, could see an extensive surge to between $1800 and $2200 per troy ounce.”
Caveat: At USAGOLD, it bears repeating, we have always advocated the ownership of both gold and silver coins and bullion for long-term asset preservation purposes rather than speculative gain. Though we pass along various projections, we do so with the caveat that anything can happen. The analyst who forecasts downside today can quickly change his or her outlook to the upside tomorrow – or vice versa. The long term charts for gold and silver, though, reveal a consistent upward trend that has served investors well in the period since 1971 when the global monetary system departed the gold standard and entered the fiat money era.
Repost from April, 2019
“‘I’m no insect,’ the 57-year-old businessman jokes. ‘Gold is a great way to make a lot of money.’”
USAGOLD note: The billionaire gold investor discusses his passion for wildlife preservation, particularly big cats. We featured a riveting Bloomberg interview of Thomas Kaplan some time ago. It is available here. Coincidentally, that interview occurred at the end of May just before gold began its run from just under $1300 to current levels. Kaplan said gold is on the cusp of launching a ten-year bull market that would take it between $3000 and $5000 per ounce. That link and the MarketWatch link above are both highly recommended. . . . .
Repost from 10-22-2019
“Following a strong first eight months of the year, the precious-metals complex may be in the process of offering investors one final chance to enter on attractive terms before lurking systemic risks erupt into breakaway price action.”
USAGOLD note: Hathaway goes on the list seven warnings investors should consider. He says that “We would guess another four to six weeks before an important bottom. However, we suggest that investors keep their eye on the big picture and take advantage of any possible near-term weakness to build exposure. This is a dip that needs to be bought.” Highly recommended. . . . . .
Image courtesy of Visual Capitalist
Respost from 10/7/2019
“‘If you are bullish on gold’s future prospects, silver is going to provide you with upside leverage with relatively low risks at these price levels,’ says Peter Spina, president of silver news and analysis provider SilverSeek.com. ‘The risk-to-reward appeal in silver is one of the best opportunities in a decade.’”
USAGOLD note: Over the past few years, we have seen gold investors increasingly adding silver to their holdings. Investors interested in larger positions in many cases are opting for our safe storage program which addresses the logistical (weight) problems associated with silver ownership.
Account Form – Precious Metals Storage Account
“The next push in gold prices will come from retail investors as risks remain skewed to the upside, according to Standard Chartered Bank.
USAGOLD note: We mentioned this article reflecting Suki Cooper’s latest thinking in yesterday’s DMR. Ranjeetha Pakiam does a stellar job reporting on the gold market for Bloomberg.
Repost from 10-15-2019
“Silver looks stronger than gold, but gold is also looking very solid, from both a fundamental and technical perspective. Whether silver breaks out from the bull wedge now or a bit later really doesn’t matter.”
USAGOLD note: Here is the link to the full article from Stewart Thomson quoted in yesterday’s DMR. . . . .
Repost from 10-17-2019
USAGOLD note: Harry Dent does not mince words in this interview. He calls what’s headed our way “the crash of a lifetime” – similar to the 1930s. 2020 is the year the bubble peaks, he says.
Repost from 10-10-2019
“New highs are times to take profits on a scale-up basis, and significant corrections offer the opportunity to step up to the plate and repurchase the precious metals. Unfortunately, the human emotions of fear and greed often drive traders and investors to buy when markets are peaking and sell on days like September 5 and 6. Trailing stops can be useful tools and capital savers during wild bull markets.”
USAGOLD note: For Investors in the physical metals, i.e., those who have their positions fully paid for and stored safely away, short-term price movements are not usually a matter of concern. For leveraged investors in the futures and options markets, it is a different story. The short-term is always in such cases a direct and abiding concern. If one fundamentally believes in the metal’s safe haven attributes, a drop in the price can be seen as an opportunity to acquire portfolio insurance at a more favorable price.
Repost from 9-11-2019
“The bullion bounce surge, which has taken off this month, will continue to be propelled by mounting investor worries, according to Swiss bank UBS. ‘Gold is set to gain as recession, trade and geopolitical risks rise, and yields fall,’ the report states. An ounce of the metal, which recently fetched $1,520 could rally more than 10% to $1,680 in 2020, the usually-conservative bank says.”
USAGOLD note: Another institution – this time UBS – weighs in with a strong bullish forecast for gold.
Repost from 8-15-2019
“Now it says the price for the yellow metal could reach as high as $1,730 a troy ounce next year, up $50 from an August forecast, a recent UBS report states. The note last month pointed to the possibility of $1,680 over the same timeframe.”
USAGOLD note: As Simon Constable points out at the link above, at $1730 it would be a pretty solid return over current prices – especially after yesterday’s correction to the $1470 level.
Repost from 10-4-2019
“Gold continues to be the clear winner amidst the surge in safe haven demand. The list of positive drivers for gold is growing. These range from synchronized monetary policy easing, lower global bond yields and increased central bank allocation. We expect further gold strength towards USD 1,650 / oz.”
USAGOLD note: Some optimism amidst yesterday’s pessimism. . . . . .
Repost from 9-25-2019
“What is amazing about this run-up in gold that we have seen is that it has taken place with the U.S. dollar actually quite firm.”
USAGOLD note: David Rosenberg is chief economist at Gluskin Sheff and Associates and a highly-respected Wall Street analyst. We were a bit surprised at his $3000 forecast for gold. He explains how it is possible to a skeptical host.
Repost from 9-16-2019
“Intensifying trade conflicts have sent global growth momentum tumbling toward lows last seen during the financial crisis, and governments are not doing enough to prevent long-term damage, the OECD said in its latest outlook.”
USAGOLD note: We cited this OECD report in yesterday’s DMR. Sounds very much like the mindset during the 1930s and Roosevelt’s New Deal. The OECD’s call on governments to do more is expressed often in top analytical circles where the view prevails that central banks have pretty much run out of ammunition.
Repost from 9-19-2019
USAGOLD note: Stoferle, along with Mark J. Valek, publish the widely circulated and referenced In Gold We Trust annual report. In this interview, Stoferle says “It is crystal clear. We are in a gold bull market again.” The most important opinion expressed is that the start of something different, perhaps very special, occurred in the gold market over the past 30-days or so. Stoferle and his hosts at MacroVoices delve into just what that “something” might be. If you are looking for fundamental insights as to why gold suddenly surged over the $1500 level, this interview will get you where you want to be.
Re-post from 8-11-2019
“‘I don’t see a lot of technical barriers above it, but I do believe that there’s people buying in to where we are today,’ Paul Rollinson told Reuters at the Denver Gold Forum.”
USAGOLD note: The Denver Gold Forum is underway and it usually generates quite a bit of interesting news and commentary. We will post updates if/as they become available.
Repost from 9-19-2019
“‘We expect spot gold prices to trade stronger for longer, possibly breaching $2,000 an ounce and posting new cyclical highs at some point in the next year or two,’ analysts including Aakash Doshi said in a note received Sept. 10. That would exceed the record of $1,921.17 set in 2011.”
USAGOLD note: Bloomberg reposted this article on its front page yesterday. We included Citigroup’s forecast in last Wednesday’s DMR. Here is a link to the complete article. . . . .
Repost from 9-17-2019
“‘I think we’re in the third and final phase of the gold market that’s started in 2001, and this will be the most explosive phase for gold,’ Giustra told Kitco News.”
USAGOLD note: This is one of the better interviews we have seen in awhile on the long-term merits of gold ownership. Giustra explains how he has structured his own gold portfolio.
Repost from 9-16-2019
“I never really ‘invested’ in gold. I didn’t trade in gold. I used it as a savings account. I used it as a reserve always thinking this is my backup. So I did that systematically over the years. So I bought gold over the years, but I never sold gold.”
USAGOLD note: Ron Paul offers some down to earth advice for everyone, but especially good advice for newcomers to the investment, i.e., treating gold and silver as savings – an approach we have always advocated.
Repost from 9-6-2019
The global economy may be facing its ‘Minsky moment’ of excessive debt — and that is great for gold prices
“For Trey Reik, senior portfolio manager at Sprott Asset Management USA, current economic conditions bear the hallmarks of a so-called Minsky moment, in which over-leveraged investors are compelled to sell their investments, catalyzing a major market downturn — an ideal environment for gold. . .[He] makes the case that the Federal Reserve’s recent interest-rate reduction in July and expectations that it will continue to cut rates, are a tacit acknowledgment that the central bank must keep interest rates low or risk a debt meltdown.”
USAGOLD note: Reik believes that interest rates must continue to decline “to keep the ever-burgeoning debt pyramid from toppling.”
“[Exter’s Inverted] Pyramid stands upon its apex of gold, which has no counter-party risk nor credit risk and is very liquid. As you work higher into the pyramid, the assets get progressively less creditworthy and less liquid. . .[In a financial crisis] this bloated structure pancakes back down upon itself in a flight to safety. The riskier, upper parts of the inverted pyramid become less liquid (harder to sell), and – if they can be sold at all – change hands at markedly lower prices as the once continuous flow of credit that had levitated those prices dries up.” – Lewis Johnson, Capital Wealth Advisor’s Lewis Johnson
In short, what Lewis Johnson outlines is the bottom-line rationale for diversifying one’s portfolio with gold. For a more detailed analysis of Exter’s Inverted Pyramid, we invite you to visit the May 2019 edition of News & Views, our monthly newsletter.
Repost from 8/22/2019
“Gold would need to rise to $2,764/oz to make new peak in real terms . . .“
USAGOLD note: We have posted versions of the inflation-adjusted price of gold chart over the years. Ritholtz provides an annotated update at the link. Worth a quick visit . . .
When you are climbing the steepest of mountains, especially at high altitudes, it can be tiring. If you start getting a nosebleed, you are simply working too hard and need a break.
The DSI on gold hit 97 four weeks ago and while it has struggled to keep up with its fellow climbers with their burst of speed, both silver and platinum are starting to look shaky.
On September 4th the DSI for silver hit 95 for the 2nd day in a row while platinum vaulted to 94.
Those are nosebleed readings.
With $17 trillion in sovereign debt around the world showing negative interest rates the old saw of “gold doesn’t have a return” has changed to “gold doesn’t lose money for holding it.” Indeed Central Banks around the world have been net buyers of gold for the last ten years.
I suppose I will have to change my tune as clearly the Central Banks have been manipulating gold and I never even noticed. I wonder why no one warned us they were forcing gold higher. Good for them, guys, keep it up.
Gold, silver and platinum will rest for a while but we haven’t seen a top. The upcoming bubble in real money is going to surprise everyone.
Well, almost everyone.
–– Bob Moriarity, 321Gold
IGUK/VideoInterview of Ross Norman (Sharps Pixley)
“As the price of gold storms to a new seven month high, Ross Norman, chief executive officer (CEO) at Sharps Pixley, discusses the London Bullion Market Association (LMBA) forecasts for 2019. Norman, who has been the best forecaster amongst the LMBA over the last 20 years, tells IG that he believes $1,360 is the price to watch. He discusses where the demand is coming from and why the retail investor and trader is the missing link.”
USAGOLD note: Ross Norman explains why the situation in 2019 looks a lot like 1999 at the link above and why a breach of $1360 to the upside could turn out to be an important development.
Repost from 2/6/2019
“As global market and geopolitical worries mount, gold is going higher. Carsten Menke, commodity analyst at Julius Baer, sees uncertainties and recession fears driving investors to safe havens like gold.”
USAGOLD note: Menke says the real drivers for gold are “trade tensions” and the “recent slowdown in global growth.” A good interview that ends with a tight summation of gold’s prospects.
Repost from 8-28-2019
“Gold will extend its winning ways as the U.S.-China standoff harms growth, risking a deeper slowdown and inviting more central-bank easing, according to UBS Group AG, which jacked up price forecasts with a prediction the precious metal may hit $1,600 within three months.”
USAGOLD note: A one two punch from UBS: Sell stocks. Buy gold.
Repost from 8-27-2019
“The goal of Wells Fargo’s statement was clearly to steer clients back into investment vehicles that generate fees and away from precious metals which generally don’t. But the impact on most clients will probably be the opposite, because most clients currently own exactly zero gold. So in reading the above they’re likely to gloss over the cautionary statements and fixate on the stuff Wells Fargo was forced to acknowledge….”
USAGOLD note: Rubino goes on to list those acknowledgments. . .”If you own no gold,” he concludes, “and your bank says you should own some, that amounts to a buy recommendation. Which is what Wells Fargo — and every other major bank — wishes it could avoid but increasingly can’t.”
For those who would like to own gold and/or silver and store it securely, we offer an individualized, allocated storage program that costs less to maintain in most cases than an ETF. You also can take delivery of your metal at any time with a phone call. To learn more, we invite you to contact us. If you would like to take the traditional route and receive delivery, we can help with that too.
Summer doldrums turned upside down
Gold’s June upturn separates 2019 from the pack
The summer months historically present a buying opportunity in precious metals as illustrated in the charts shown below. In the past, there has been a clear change of direction in sentiment annually from the 185-195 day mark – midway in the year. So far this summer, though, gold has broken with tradition by turning in a strong June, as shown in the third chart.
“Gold trading usually gives pundits, dealers, and investors a break at some point over the summer,” observes Adrian Ash at BullionVault. “But like 2007, 2008, 2009, 2011 and 2016…this year is proving no time to take your eye off the market. And if 2019 is going to see an old skool summer lull in gold trading, it won’t feel much like a discount up at these prices.”
With a range of economic and geopolitical issues preying on investor psychology – particularly at the funds and institutions that have fueled the upside this year – the summer of 2019 might go down as one of those years when we bypass the annual slowdown. Last year, gold hit a low of $1178 in mid-August. By December 31st, it was trading at the $1280 mark.
Charts courtesy of GoldChartsRUs/Nick Laird
Featured in the July edition of News & Views (7-10-2019)
Much more at the link
“The strange persistence of the strong dollar with the rising gold price has puzzled many participants this year. Some are even beginning to suggest that the dollar’s inverse relationship with gold has been broken. In this report, I’ll make the case that what we’ve seen so far this year has been an exception to the rule. The evidence I’ll show here implies that we’re likely to see a divergence between the U.S. currency’s value and the gold price in the coming months. And while the dollar remains strong right now, gold will likely continue to outperform the greenback due to the threats facing the global economy.”
USAGOLD note: Gold as king of the hill. . . Who would have suggested such a thing six months ago? Given the flow of capital into gold these days globally and the entities responsible for it, you would have to think that something is going on a bit out of the ordinary.
“Gold prices can continue to climb even after they hit a multi-year high last week, a global investment strategist said Monday. In fact, prices are set to ‘reach $2,000 by the end of the year,’ predicted David Roche, president and global strategist at London-based Independent Strategy.”
USAGOLD note: Something major would need to happen for gold to reach $2000 by the end of the year. Roche thinks he knows what that something might be. Financial markets, he says, “are are now poised to crumble like a sand pile.”
“In a world full of negative yielding debt, hard assets like gold could become even more attractive, and some strategists say a case could be made for a $2,000 per ounce price tag on the precious metal.”
USAGOLD note: TD Securities’ Daniel Ghali thinks we may be on the brink of a years-long bull market for gold.
Repost from 8-15-2019
“For Goldman Sachs Group Inc. analysts, gold’s rally above $1,500 is just the beginning. Analysts at the bank predict that prices already at six-year highs will climb to $1,600 an ounce over the next six months as investors seek havens. The dimming global economic outlook, fueled by heightening trade tensions between the U.S. and China are boosting gold’s appeal as a hedge against financial turmoil.”
USAGOLD note: Goldman is off-again, on-again when it comes to gold. . .It is now on-again and on the record with one of the more bullish numbers among Wall Street firms.
Re-post from 8-8-2019
“There is this humorous saying: ‘It walks like a duck, it sounds like a duck, and it walks like a duck. Maybe it is a duck?’ The prices of gold and silver have gone up quite substantially since June, with gold for the first time since 2013 trading at around 1,500 USD/oz; silver trades close to 17 USD/oz. Where do we go from here? The rise in the price of gold appears to be a ‘catch up’ price movement. Gold has been trading at what appears to be a discount for quite a while. As we pointed out in our Degussa Market Report on 25 April 2019, at that time, the fair price of gold would have been around 1,500 USD/oz. We now consider it necessary to raise this estimate.”
USAGOLD note: Degussa goes on from there to give a bullish price estimate for the future. . .at the link above.
“Societe Generale, famed European investment bank, has just told investors they should load up on gold. . .”
Re-post from 8-8-2019
“A host of global factors mean gold’s price is set to maintain its strength at least for the next six to 12 months, according to an economist from a top Singapore bank. ‘The world right now is in a precarious state and gold is due to benefit from this situation,’ said Howie Lee, economist at Oversea-Chinese Banking Corporation.”
USAGOLD note: With the world – from Asia, to Europe, the United States and a long list of emerging countries – now acutely attuned to gold ownership, it might not be long until we begin to see strains on the limited physical supply.
Re-post from 8-7-2019
“According to historical performance, whenever the ratio of gold to silver is much higher than normal (usually 70 to 75), this means that the bottom of the silver price appears. When the ratio of gold to silver exceeds 80, the price of silver is too undervalued relative to the price of gold, which is often one of the most reliable buying signals for silver.”
USAGOLD note: The ratio topped at least temporarily at 92.32 to one in early May. The average ratio, as this article points out, is about 55 to one. “A new round of silver surpassing gold may have begun,” concludes the author.
Chart courtesy of TradingView.com
Re-post from 8-4-2019
“We can best see gold’s potential giant base pattern on a 10-year chart. It can be described as a complex Head-and-Shoulders bottom or as a Saucer, and is best considered to be both, or perhaps as a hybrid having the characteristics of both patterns. In any event, as we can see on this chart, it appears to be drawing close to breaking out of it, which will be a very big deal if it happens, because a base pattern of this magnitude can support a massive bullmarket. As for timing it could take several months and it is most likely to happen during gold’s seasonally strong period from July through September. To maintain the bullish case it must stay above the Saucer boundary.”
USAGOLD note: We post Clive Maund’s forecasts from time to time – one of our favorite tech analysts. His latest is worth the visit – a positive prognosis for gold based on structural chart patterns.
Repost from 5-22-2019
Dollar Collapse/John Rubino/6-25-2019
“The gold/silver ratio – that is, how many ounces of silver it takes to buy an ounce of gold – has bounced all over the place since the 1960s. But whenever it’s gotten extremely high – say above 80 – silver outperformed gold, sometimes dramatically.”
USAGOLD note: Often in the past during precious metals rallies, silver has lagged gold only to make up for it as time moved on based on the gold-silver ratio coming into better historic balance.
Re-post from 6-27-2019
“The bulls point to a peaking US business cycle, inflationary and growth-destructive tariffs, a tight job market, an increasingly dovish Fed, strong central bank buying, de-dollarization, out of control government spending and debt, and Chinese investors buying more gold instead of investing in their weak stock market. . .In the big picture, both fundamentally and technically, the bulls clearly have not just the edge, but a mighty wind at their backs.”
USAGOLD note: Stewart Thompson goes into the details in this bullish post at 321Gold. . . . . .
Re-post from 8-4-2019