Tuesday, January 5, 2021
Gold - Long Term Charts and Central Banks
Gold is currently trading around the 2011 peak. With 10 years of buying by central banks the price of Gold is the same as 10 years ago. Gold may have have short term upside, but what is troublesome is that the central banks may have overinflated the price. When central banks were sellers the low was marked around $250 in 1999. Now central banks are buyers, but when they return to a neutral stance the price of Gold would likely fall.
7 day chart
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In 1999 Central Banks had no use for Gold. It didn't return any income and was costly to store. Central Banks sold at the low. They continued to sell until about 2005. Then they switched to buying.
ReplyDeleteSelling diminished until 2009.
DeleteFor 10 years Central Banks have been buying aggressively and they may be marking a top for Gold.
ReplyDeleteI doubt Central Banks would be heavy sellers again but returning to a neutral stance seems likely. When that happens the price of Gold would likely fall significantly.
ReplyDeleteI view Gold as a long term trade. When the Central Banks stop buying and the price settles down that seems it would be a good entry for the long term.
SC,
ReplyDeleteGood to here from you--
The VIX had a nice pop yesterday -resistance seems to be 28.5 to 29. With elections and political situation---do you see a pop to above the low 30's in the short term?
VIX has been finding resistance at the 200 dma for now.
DeleteSc your gold chart looks like a big cup and handle forming over years
ReplyDeleteGood Call SC analysis is interesting.
DeleteI mean Louis, it does look like a cup and handle
DeleteDhorted tqqq 177.40
ReplyDeleteHnhpf looks like a stock u could retire on
ReplyDeleteSome high flyers in Canada XRX.CA, BWLK.V, GMA.V
Deletemaybe 3530 then Final rally to 4050 4070
ReplyDeleteSC, gold is going much higher, the elections now guarantee it....
ReplyDeleteSilver update needed. My friend, wrong again!!
ReplyDelete