Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Dino's Bar & Grill -- Ignore unavailable to you. Want to Upgrade?

To: Goose94 who wrote (7543)	6/30/2014 8:37:44 PM
From: Goose94	Read Replies (1) \| Respond to of 203382

Gold Is Going To $1,900 If It Breaks Out Upside Of This Wedge Let’s talk about Gold… Many analysts believe that the precious metal is DEAD due to its having fallen from a record high of $1900 per ounce to roughly $1200 per ounce today (a 36% drop). However, this price movement, while dramatic, is quite inline with how commodities trade. Gold has already posted one drop of 28% (in 2008) during its bull market, before more than doubling in price. This latest drop is not much larger. Moreover, a 36% drop in prices is nothing in comparison to what happened during that last great bull market in Gold back in the 1970s. At that time, Gold staged a collapse of nearly 50%. But after this collapse, it began its next leg up, exploding 750% higher from August ’76 to January 1980. Again, a 36% drop in gold prices is perfectly in line with Gold during a bull market. Indeed, despite this drop, Gold maintained its long-term trendline: With that in mind, we believe the next leg up in Gold could very well be the BIG one. Indeed, based on the US Federal Reserve’s money printing alone Gold should be at $1900 per ounce today. Since the Crash hit in 2008, the price of Gold has been very closely correlated to the Fed’s balance sheet expansion. Put another way, the more money the Fed printed, the higher the price of Gold went. This relationship was skewed in 2011 when Gold got bubbly (hence the sharp correction we were talking about earlier). But at this point, it’s dramatically undervalued relative to the Fed’s balance sheet. Indeed, for Gold to even realign based on the Fed’s actions, it would need to be north of $1,900. That’s a full 30% higher than where it trades today (see below). Indeed, from a technical analysis perspective, Gold is close to breaking out of a wedge pattern: If we stage a breakout to the upside, then we’re off to the races and that $1,900 price per ounce target is in play. Best Regards Phoenix Capital Research