We had a slight retracement today based on an algo bounce across the US indices. Despite the decent bounce across the indices around the world, Gold and Silver's losses were muted, thereby further supporting the long bullish trend I have been discussing for a long time. If today was "true bearish", we would be sitting into the 1490s.
I am expecting a movement upwards next week with a near-term target of 1540 +/- 5pts with a slight retracement before a longer and more gradual uptrend from late August to the 2nd week of September.
The ECB is expected to almost for certain ease and that will likely provide a quick jolt of about 20.00 in Gold.
The Fed is also expected to ease, however, the Fed's easing is more questionable even though I believe Powell will ease 25bps. Due to the fact that the Fed's policy is more unpredictable than ECB, I am looking at a retracement after the ECB and before (in anticipation of) the Fed. After the Fed is likely to ease however, I am expecting that pushes Gold over 1600. Therefore, my 1600 ETA date is September 17-18.
Banks around the world will begin QE (Quantitative Easing) and by no means should any rational person who understands monetary policy and geopolitics call for Gold and Silver to be bearish longer than a daily interval (for shorts). I do not focus on shorts however, because nearly everyone loses money in the long-term when shorting metallics. Gold and Silver's bull run will end when the threat of rate HIKES increases which puts us in an at-least 3-4 year overall bull cycle.
While the DXY and the metallics are somewhat disconnected now, big 3%+ daily gains will be subdued until the DXY begins to drop below 97. The DXY will begin declining when the Fed confirms the longer easing cycle which will likely be in September.
How high do you think it can go? Say in a year from now or even two years from now. I have seen some people throwing around crazy numbers, seems far fetched.
PaulDeep19131
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@coloradobarry
Great question.
Truthfully in the nearish term (i.e. by January 2020), I believe we will be in around the 1900 mark. In the longer term, such as 2021, 2022, 2023, I believe we can easily top 3000 and probably go even higher. Now, what's important is that even though 3000 "sounds like a lot of money so its not possible", when you compare the last 2 peaks of Gold (1900 in 2011 and about 700 in 1980) people would have said the same thing about 1900 when the prices were 700.
Its important to not get lost in the actual peak value, but rather understand why Gold and Silver could rise. While some people think this is a bull run we are seeing right now, I consider it only the pre-bull run. The fact that Gold has already breached 1500 and quantitative easing around the world has really only been mentioned, but not yet acted upon (until September), this ultimately proves the true bull run is approaching quickly.
There are many reasons to be bullish on Gold/Silver, such as: 1) Geopolitical tensions around the world, 2) Global recession within the next 12 months or so, 3) Monetary easing down to 0, 4) No threat of rate hikes anywhere in the world for at-least 3-4 years, 5) Trade tensions, 6) Other issues such as Brexit/US Gov shutdown potential in October/USA and Huawei issues, Sept 1 tariffs, Hong Kong issues, etc, etc.
Right now Gold has had some strong retracements but they become more and more muted as we have gone through the 1300s, 1400s and now 1500s. Once we get to 1700 you will see FOMO really start to set in and you'll see big 3%+ daily gains in Gold and Silver. For now though, not until we get to at-least 1600 in Gold (and 18 in Silver) can you expect consistent and big daily gains.
The reason people are bearish in the metallics is that people do not want to believe the metallics are making a run so they are perpetually bearish. They view metallics as worthless and only view things like "technology" as useful and warranting of a parabolic move.
Right now (especially) the market is heavily manipulated by algos so using technicals and pattern indicators to try to predict Gold/Silver right now is laughable. All you need to know is that when the market bounces off an algo, Gold/Silver losses are not that significant.
I have said many times before, while this past decade will be known in history as the bubble of technology, innovation and soaring valuations, the decade from 2020-2030 will be the return of metallics.