Immediately after experiencing an amazing bull market run from $250 an ounce in 2001 to $1,900 an ounce last summer, gold hasn’t had an easy time of it since.
Three times it plunged around 19%, and rallied back, just to run into resistance every time at $1,800. It is possibly doing so once again.
That’s probably baffling buyers who have been viewing so numerous big-name experts and fund-managers become extremely bullish for gold, with thinking that looks sound.
The latest Reuters poll shows precious metals experts became more bullish for gold and silver than they’ve been in a couple of months.
Even technical evaluation was supporting the favorable perspective. My technical indicators initiated a sell signal on February 19, almost exactly at that peak, but had me and my clients back on a buy signal in mid-August and back to a 20% position in the gold etf GLD.
The case for gold, at least from the basic side, still sounds bullish .
As Ray Dalio, chief investment officer at Bridgewater Associates, the world’s biggest macro hedge fund lately told CNBC audiences, “We have a condition exactly where there is too much debt, which results in central banks printing money, which is bullish for gold.”
Other professionals add that anxieties of the looming ‘fiscal cliff’ in the U.S., and probability that rating firms will downgrade the credit rating of the U.S. once again, are positives for gold throughout the next few months.
There’s also the anticipation that the Fed’s latest QE3 program will be inflationary, and gold is the conventional hedge towards inflation.
Then there’s a brief history that gold often (but not always) moves opposite to the U.S. dollar, and the dollar has been in a decided decrease since July.
Could gold probably be saying that the ‘fiscal cliff’ will be efficiently solved? Or perhaps central banks are likely to vigorously market gold from their reserves to raise cash to assist with their debt loads? Or perhaps the world economic recession continues and result in deflationary pressure instead of increasing inflation?
I do not have the response to those questions, but I can certainly assist you answer several of your other gold concerns. Check out my own web page to learn more: Buy silver.