A Closer Look at the Turnaround Time
Kitco Commentaries | Opinions, Ideas and Markets Talk
Featuring views and opinions written by market professionals, not staff journalists.
We’ve talked a lot about the turnaround time in gold over the last two years. We’ve believed that a major change has been taking place, from a bear market to a bull market. That is, the gold price has been in a turnaround time period since hitting a low in December 2015 at $1049.
And this year, gold is holding firm with the feeling of wanting to break out of this turnaround time!
Once this happens, the bull market will be in full force and the turnaround time will be over. And it looks like this will be coming up pretty soon.
WHAT TO WATCH...
The most important number to watch is $1380 on the gold price. This has been the key resistance area during the full bear market since 2013.
The bear market’s saucer bottom has had stubborn resistance at this level. Gold has been holding below it, but gold has held firm due to safe haven buying during the turbulence, and the weaker dollar.
Gold will remain under pressure for now by staying below $1360, and if it declines below $1305, it could then test the 23 month moving average (MA) at $1277. Note how gold has essentially stayed above this key MA over the last two years.
But once gold breaks clearly above $1380, it’ll be off to the races.
DEMAND BASED RISES
A demand based rise is the most powerful rise. It can be based on investor demand, safe haven demand, economic growth demand. There’s also demand based on inflation and/or a weak U.S. dollar.
Gold demand continues to grow. Plus, the most famous money managers have gold in their portfolios. Be it Ray Dalio for its store of value and portfolio diversification, or David Einhorn as an inflation hedge, many have a valid reason to hold gold.
Lord Jacob Rothschild , for instance, is all about wealth preservation. He rightly says that the central bankers continue on their greatest experiment in monetary policy in the history of the world.
It’s hard to wrap your mind around this thought because as time moves on, it’s easy for us to become immune to what’s happening. But it’s not normal.
We agree with them all. And we believe gold and this universe is at the onset of a great bull market. And we want you all on board.
Mary Anne & Pamela Aden are well known analysts and editors of The Aden Forecast, a market newsletter which provides specific forecasts and recommendations on gold, stocks, interest rates and the other major markets. For more information, go to https://adenforecast.com/