Time to sell gold?
I think gold will come down below $350 due to so many factors.nAny other ideas. Thanks.
Best Answer
121 points
JohnsonAndLewis answered one year ago …
It depends how long you look out.
The recent decline in gold prices has some market watchers scratching their heads, as gold is often a safe haven for volatile markets. But the typical bear-market gold trade has been squelched by the strength of the U.S. dollar as investors have felt less pressure to hedge economic weakness. This situation appears to be in transition, as the dollar is finding technical strength while it is showing some signs of becoming "toppy."
Of all of the sectors out there, one of the few that has shown some prominent indications of a potential move is the gold sector, so we recently established a short-term call position in a gold Exchange-Traded Fund (ETF) in my Winning Edge service.
At this point, the potential move in our gold-based call options could be driven by a powerful combination of three main catalysts: slowing dollar strength, pessimistic sentiment and recent technical support. We believe that this situation provides one of the very few attractive sector plays at this time.
Answers
4085 points
EthanR answered one year ago …
I don't agree. I think gold will find a bottom at a higher level, and down the road all of these FED interventions will have to have inflationary repercussions. When that happens we will see gold rise in price. If you look at the chart of GLD, you will see that it has recently been showing signs of strength.
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546 points
warren answered one year ago …
You are right Ethan, and the stocks, well there an even better deal. Silver is is better since it is a by product of base metals and so mnay base metal project are being shut or scaled down. Supply and demand, it's that simple. Quantitative easing has begun, hyperinflation is on the way.
Just for fun did you know that $8.5 trillion has been injected into the financial system to date? TO put that in perspective a stack of $1000 bills for inches high is a million bucks. A trillion of $1000 bills stacked is over 63 miles high. Try and wrap your head around that!!!
Warren,
www.preciousmetalstockreview.com
989 points
rvilmur answered one year ago …
Gold is a buy and not a sell. Gold production is still dropping and very few new mines will be in production for the next several years and many companies that would like to start the setting up of new mines for production are hamstrung by the lack of available capital at a reasonable cost.
The world is now being flooded with paper money which is highly inflationary once the world economy starts to improve. Gold is still real money and should be accumulated. Much of the new investment demand is now in the Gold ETF's which has less visibility. Gold coins and bullion are now scarce so gold is actually being accumulated.
Silver is also in short supply as many base metal mines are lowering production. Silver as the poor man's money should follow gold up.
216 points
jrj90620 answered one year ago …
The Dollar Mania is in full swing now.Look for a crash soon and real assets to soar.All countries joining the U.S. in devaluing their currencies.Great time to buy gold and other real assets.Very risky to be holding currencies now.
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jester112358 answered one year ago …
I agree with the other comments that we are in huge, unsustainable rally in the US$ and yen driven by forced hedge fund equity liquidations and the end of the yen carry trade. Credit is temporarily being deflated along with asset prices. When this ends, and it will because governments hate deflation more than inflation, the reality of the huge increase in the money supply will become plain and both gold and silver will explode to the upside as they are a finite resource. I want to own finite resources-not nearly infinite ones like the US$.
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731 points
thinker70 answered one year ago …
I wonder who or what you are reading to come to the conclusion that gold will drop as low as $350.?
While further weakness is certainly possible and in this unstable and manipulated market anything could happen in the short term, do you understand that gold and silver have a a 5000 year history as MONEY and preservation of puchasing power that NO paper currency can possibly match?
If you are treating gold and silver as "just another commodity" to be traded, then maybe you are right, it MIGHT b a time to sell and buy back in again, but one of these days gold will have a hundred dollar day rise and you would miss out!
While nothing goes straight up forever, the way things are shaping up with the DEMAND rising to the point that physical gold and silver are becoming difficult to come by all around the world, production is DROPPING, instability in the whole financial system, further deleveraging likely at some point the masses will have to recognize that there is no safety in holding paper of any kind, (promises to pay, mere I.O.U.s) and will want to open HONEST MONEY with intrinsic value and when that happens, whatever thentrigger might be, there will be a parabolic rise in precious metals that will be stunning in its intensity.
546 points
warren answered one year ago …
Thinker has the best answer bar none. Great answer.
Warren,
www.preciousmetalstockreview.com
678 points
BoxCar answered one year ago …
About what a Trillion $ is, I can see where Warren says a stack of 1000 $1000 bills is 4"
because a single bill is 0.004". Multiplied by 1000 (for $1Million) you get 0.004 x 1000
or 4 inches high. but if this is multiplied by 1000 (for $1Trillion) you get 4000" or 111yds
So a punchcard-style file of $1000 bills would stretch the length of a football field from
goal post to goal post. Now that is something I can fathom- a whooole lot of mooola'!
678 points
BoxCar answered one year ago …
Whoops, I meant to say what a BILLION is- that 1 Billion$ is the length of a football field 111yds, of $1000 bills stacked in punch-card file fashion from goal post to goal post.
Warren is right, for 1Trillion$, itd take 1000 football fields or about 63 miles- too big!
So we can see how worthless all that paper has to be. Get out your wheelbarrows,
we're going to need them
