Countries want to see higher Gold prices. A huge rise in the Gold price is the only thing that will keep the many countries solvent going forward. They must accumulate Gold in these late cycle sideways corrections that are created by “management of Gold’s price” for that very reason. It was the same in the late 70’s. Big moves late in the cycle for Gold and for Silver come after long sideways movements such as we have seen over the past 24 months. Those and other reasons discussed in this post simply scream that Gold is ready to go parabolic.
So writes Goldrunner* (www.GoldrunnerFractalAnalysis.com) in edited excerpts from his most recent newsletter to subscribers (excluding his illustrative charts which are only available to subscribers) posted here with permission. Go here to subscribe and receive his unique analyses with one-of-a-kind charting.
This post is presented compliments of www.FinancialArticleSummariesToday.com (A site for sore eyes and inquisitive minds) and www.munKNEE.com (Your Key to Making Money!) and may have been edited ([ ]), abridged (…) and/or reformatted (some sub-titles and bold/italics emphases) for the sake of clarity and brevity to ensure a fast and easy read. Please note that this paragraph must be included in any article re-posting to avoid copyright infringement.
Below are snippets of what Goldrunner had to say regarding where and how Gold and Silver move going forward with some comments on other precious metals, potential hyperinflation and the future of the Dow:
1) There is little doubt that we are at the area in the long-term cycle where a huge move higher came for Gold and Silver in the late 70’s.
2) The fundamentals for such a move are coming together:
- Huge Dollar printing,
- Global Competitive Currency Devaluations in full swing and, most importantly,
- Countries seeking to reclaim their Gold that the Federal Reserve has been holding. (Is this a problem for the US, or has the US used that Gold to manage the price via the Exchange Stabilization Fund to help all the various Central Banks and countries by buying time for other countries to accumulate gold?)
It is the above latter occurence – countries asking for their Gold – that simply screams that Gold is ready to go parabolic because most countries have accumulated most of the Gold they think they will need – now, they want to see higher Gold prices.
3) Big moves late in the cycle for Gold and for Silver come after long sideways movements until Gold approaches the log channel bottom.
4) These sideways movements see Central Banks step-up to heavily accumulate Gold as has occurred in this current sideways correction. As we have noted before, and as JS has described on his site for the last few weeks – a huge rise in the Gold price is the only thing that will keep the many countries solvent going forward. [Read: Governments Will Want – Will NEED – Much Higher Gold Prices! Here’s Why] Thus, they must accumulate Gold in these late cycle sideways corrections that are created by “management of Gold’s price” for that very reason. It was the same in the late 70’s.
5) Silver made bottoms before huge runs in late January in 2010 and 2011.
6) Gold has corrected down to the top of the upper fan-line and bottomed at the same log channel bottom line that led to a huge run to double the channel in fractal 2005. Thus, this week could see a very significant historical bottoming point of interest for Gold and for Silver.
7) The DJIA Stock Index has been climbing and that fits well with the Fractal 70’s. The Dow rolled over while Gold and Silver made their first parabolic runs in 1979. The Dow did not crash. We used the DJIA in the late 70’s to help triangulate how high Gold might run to in the current Gold Bull. Fractal comparisons to the late 70’s suggest the Dow will correct down to the 10,000 to 12,000 zone and meet the price of Gold in that range before the Gold Bull is over.
8) IF, the Dow runs much higher than the 2007 high, then “hyper-inflation” is a real possibility, but there is no reason to expect that to occur at this time since everything is tracking the late 70s. Gold to $10,000 to $12,000 would be the Stagflation equivalent of the late 70’s. True hyper-inflation would see Gold go much higher.Gold and Silver primarily gain from the massive Dollar Inflation underway due to their intrinsic value.
9) Platinum and Palladium should also participate well. Copper and other metals should do very well. Intrinsic value “rules” during aggressive paper currency printing/ devaluation, though most metals will be inhibited to some extent due to economic weakness.
10) Value will return to the DJIA Stocks to reflect the devalued Dollar AFTER earnings and dividends return to higher levels but that cannot happen until the economy recovers, and QE does little for the economy except to keep it from crumbling.
This week could see a very significant historical bottoming point of interest for Gold and for Silver….Big moves late in the cycle for Gold and for Silver come after long sideways movements suggesting that both precious metals are ready to go parabolic.
For the moment, GOLDRUNNER ~ Email me at [email protected] with your questions and comments.
Editor’s Note: The author’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.
*Goldrunner offers a subscription service which provides detailed technical analysis of where the price of gold, silver and precious metal stocks are going in each stage of their respective bull runs. This service comes with detailed charting based on conventional technical analysis and his proprietary fractal analysis based on the ’70s. Go here to subscribe.
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Sentiment in the precious metals sector is in the toilet yet the fundamentals for the sector are off the walls positive. That is not secret, but it is what creates huge market moves in the direction of the fundamentals. In fact, market management will never move price against the underlying fundamentals for too long a period of time.
Our subscription service provides detailed technical analysis of where the price of gold, silver and precious metal stocks are going short term (in the next week or two), intermediate term (within the next 3-6 months) and long term (the ultimate top) in each stage of their respective bull runs. This service comes with detailed charting based on conventional technical analysis and our proprietary fractal analysis based on the ’70s. Below are some of our latest comments and rationale for expected price movements in gold without illustative charts which are only available to subscribers. Words: 1000
The prospects look great for Gold and Silver to move sharply higher into 2013 to mimic the moves made in the 2005/ 2006 period and especially in 1979. In both cases back then the PM Stock Indices made big runs along with Gold and Silver. As such, the current HUI looks good for a major bottom to now be in place and to mimic the PM Stock Surrogate chart from the late 70’s. This would see the HUI go as high as the 1000 area in 2013. Let me explain further. Words: 640
Personally, based on the fundamentals at hand and the fact that Gold doubled its log channel around this point in the cycle; I expect Silver to bust up out of its log channel in 2013. Initially, I look for Silver to reach the $60 to $68 level, first and hold open the possibility for Silver to do much more on the upside as the 70’s Silver Chart reflects.
My Fractal Gold chart work is a direct comparison of Gold, today, to the late 70’s Gold Parabola. Thus, “timing” is taken directly from the late 70’s cycle, with price targets created from a combination of the late 70’s Gold price and different technical analysis techniques. We developed a price target back in 2006/ 2007 for Gold to reach the $10,000 to $12,000 range during this Gold Bull and we still stand by that forecast. Let me explain where we are at this point in time.
All fundamentals and opinions are useless in the markets because they pertain to timing, and timing plays a huge role when investing/trading….[and only] put one’s belief system into a context with regard to the market[s]….It does not matter what others say about the market; what matters is what the market says about others. The market is, and always will be, the final arbiter of all “facts” and “opinions.” [This article give an update on exactly what the charts are currently saying about gold and silver.]
It is impossible not to read some source…touting the “fact” that the price of gold and silver will be…[“$x”, “$y”, etc.] in the “coming months” or in the “next year or two,” etc. The market, however, does not echo those…sentiments because that is exactly what they are, sentiments. When it comes to sentiments or opinions, regardless of how close to source or how well reasoned, the market does not care. The charts are all-knowing, and they present everything known about the price, sans any opinion(s). Just deal with the facts and plan accordingly. Trust the markets – they never lie – [and this is what they are saying about the price of gold and silver in 2013]. Words: 1889; Charts: 6
I expect the eventual endgame to this whole Keynesian monetary experiment that has been going on ever since World War II [will] finally terminate in a global currency crisis. [That being said,] I’m starting to wonder if we aren’t seeing the first domino – the Japanese yen – start to topple…[It has] cut through not only the 2012 yearly cycle low, but also the 2011 yearly cycle low and never even blinked [and should it continue its steep decline] and break through the 2010 yearly cycle low [of 105.66] I think we have a serious currency crisis on our hands. Needless to say, if the world sees a major currency collapse… it’s going to spark a panic for protection – to gold and silver. Wouldn’t it be fitting that at a time when they are completely loathed by the market they are about to become most cherished? [This article analyzes the situation supported by 3 charts to make for a very interesting read.] Words: 620; Charts: 3
That governments will want – and will NEED – much, much higher gold and silver prices in the future is counter intuitive, given that they have done everything within their power to throttle back and to keep a lid on bullion prices. Let me explain why. Words: 1300
The price of gold, on a quarterly basis, is 86% correlated – yes, 86%! – to total government debt going back to 1975… and a shocking 98% over the past 15 years! [As such,] it would seem like a no-brainer investment thesis to buy gold… as a proxy for the not-otherwise-investable thesis that US total government debt will increase in the future. [But there is more – and it is disappointment for gold bugs – read on!]