In my UncommonWisdomDaily.com column today, “Is Gold Your Best Bet?,” I lay out some of the bullish and bearish forces working on gold right now. I also say that we could get a pullback to 850 or 800 in gold, and that would be a tremendous buying opportunity.
Well, thanks to yesterday’s price action, we may be getting a set-up for a decent pullback in gold. Let’s look at a chart of gold with Fibonacci retracements — common support and resistance levels used by market technicians …
Many investors will be playing the gold move through the SPDR Gold Trust (GLD: 106.46 +2.51 +2.41%). While that is supposed to track the gold price at a ratio of 1-tenth the price of gold, in reality it’s slightly different …
So if we get a pullback, these are the numbers to keep your eyes on.
More gold news …
Gold extends losses as jobs report not as bad as feared Gold futures extended losses Friday, down 1% to below $900 an ounce as data showed the U.S. economy lost fewer jobs in March than expected, reducing the metal’s appeal as a safe asset. Gold for April delivery fell $9.20 to $898.20 an ounce in early North American electronic trading. The U.S. economy lost 663,000 jobs in March, fewer than the 688,000 that analysts surveyed by MarketWatch had expected. Meanwhile, unemployment rate rose to 8.5%, in line with expectations.
Gold: The Long And The Short Term Of It There is a battle raging in gold. On the one side is the “safe haven” trade and on the other is the “inflation” trade. When the credit crunch first hit gold made it US$1000/oz on a weaker US dollar and fear of risk in the US financial system. When the credit crisis became the GFC gold again made it US$1000/oz despite a rebound in the US dollar (which was brought about by the world buying the other safe haven asset - US bonds) on fear of risk in the global financial system. The latter was exacerbated by the inflation trade as investors bought gold against the huge amounts of paper money being printed across the globe.
New gold rush hits CaliforniaMore than 150 years after the great Gold Rush that propelled California’s development, the prospect of striking it rich prospecting for gold remains very much alive. Panners are appearing at streambeds due to the price of gold, the poor economy, and a 10.5% statewide unemployment rate that leaves a lot of people with time on their hands, officials say.
And some copper news …
BHP Says Building New Mines to Become Cheaper Than Acquisitions on Costs BHP Billiton Ltd., the world’s biggest mining company, may develop new copper mines rather than acquire them because of falling costs, said Diego Hernandez, the president of the company’s base metals division.
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If gold drops to 750/oz, can I start thinking conspiracy theory? when I hear the term “cap and trade”, I think of gold.
Read a report that IMF will sell gold in large volumes to further reduce gold price. Report by Chuck.
I covered that in my Friday column for UncommonWisdomDaily.com:
http://www.uncommonwisdomdaily.com/is-gold-your-best-bet/
I have a tough time following it. Gold went down last year with the broad market because it was said the hedge funds and other investors were selling their gold to cover their shorts. This after gold spiked to a thousand/oz for a day or so. Now they are selling their gold to buy equities. Two weeks ago gold was primed to attack 1000/oz again and beyond. Now we’re looking down towards 850/oz. It was supposed to sky rocket in crisis, but went down. US and everyone else is printing money like there is no tomorrow. So it spiked again to 1000/oz for a day or was it an afternoon? and things are just getting worse and the bullish are all there in spades. The perfect storms have seemed to happen a few times. China is buying all they can get. Ditto Russia and others. But investors are profit taking. Production is way down. Physical gold is hard to get. Is inflation so far down the road that no one cares? all I can say though it has held up better than other investments, it is frustrating still. It seems that when I buy, when everyone says buy buy buy, it happens to be at the top of the curve ready for the 10-15% down turn. Can fibonacci, 50 day 200 day and all really be as relevant when there seems to be rampant artificial massaging of the markets? Just sounding off and am holding my gold. Hopefully they won’t confiscate it. Keep up the analysis, I am addicted to it.