What The Hell, A New Gold Thread.........

mini_lidi

hahahah that has made my day

Decadent_Fool

mini_lidi wrote: »

I hate gold
all this time i spent debating wether to buy or not
If only i had

...you would probably have had your profit taken up in trading fees...

cloud_dog

mike22 wrote: »

Based on what these percentages?

Mike22, my percentages are based on my novice charting capbilities (I wouldn't go as far as saying skills).

Have a look at the chart:
http://finance.yahoo.com/q/bc?s=GLD&t=5y&l=on&z=m&q=l&c=

If you look at a chart of gold over a few years you can see that recently (since March 08) it has been in a formation known as a 'flag' (penant to the yanks) which is lower highs and higher lows. This formation usually indicates a continuation of the general trend (in this case up) when the general shape is broken.

My original thoughts were that gold would retrace (again) without breaking up from the upper level of the flag. and a retracement to the bottom line of the flag would put gold in the range of $850 - Approx 10-15%.

This level serves as a level of support, i.e. it may drop to around that figure and then (after a while) start increasing.

This is what I was hoping for; it would have allowed gold to build a more solid base.

What has happened is that gold has (at the moment, we need to check end of day prices) blasted through the top of the lower highs and shot on up to apporx $1005. From hear I'm not sure where it will really go, it might re-test the all time high, $1030ish.

If it does re-test it and fails then a retracement is in order. Again the $850ish level would provide support but there would be a case for a wider trading range for gold possbily as low as $700. This is where I get my 25-30% number from.

Let me just say I am not an expert and these are my own thoughts / hopes, and I have been proved wrong in the past.

cloud_dog

sabretoothtigger

Just a quick look at that graph, I can see a double bottom or inverse M formation fairly recently which suggests to me a strong rise from that point especially as its completed the formation now

No idea if thats right, I click the larger size graph and its not there, weird /
unreliable


http://en.wikipedia.org/wiki/Gold_exchange-traded_fund



Maybe obama will be forced to seize gold like fdr did, would make alot more sense then buying bank shares has done
Russia has bought 90 tonnes of gold and advised america against socialism :rotfl:

Over 2005 the World Gold Council estimated total global gold supply to be 3,859 tonnes and demand to be 3,754 tonnes, giving a surplus of 105 tonnes.[21]

A World Gold Council report released on February 18, 2009 showed physical gold demand rose sharply in the second half of 2008. Identifiable investment demand for gold, which includes ETFs, (exchange-traded funds) bars and coins, was up 64 percent in 2008 over the year before

The average gold mining and extraction costsI][URL="http://en.wikipedia.org/wiki/Wikipedia:Manual_of_Style_%28dates_and_numbers%29#Chronological_items"]when?[/URL][/I are $238 per troy ounce but these can vary widely depending on mining type and ore quality.

In 2001, global mine production amounted to 2,604 tonnes, or 67% of total gold demand in that year. At the end of 2006, it was estimated that all the gold ever mined totaled 158,000 tonnes.[18]

A cube with an edge length of just 20.2 meters would contain every piece of gold ever found




QE?

The main purpose of either government money system has historically been to provide seigniorage, or money-creation profit, to governmental leaders in order to provide them with general purchasing power during emergencies, especially those leaders who are legislatively constrained and therefore unable to raise taxes in order to execute the defense commitments that are required for the survival of their states.[2]


In macroeconomics, seigniorage is regarded as a form of inflation tax, as paying for government services by issuing new currency (rather than collecting taxes paid out of the existing money stock) has the effect of creating a de facto tax footed by those who hold the existing currency, as a result of its effective devaluation through the introduction of additional money.[2]

cloud_dog

sabretoothtigger wrote: »

Just a quick look at that graph, I can see a double bottom...

sabre, the only double bottom I can see is on the wife........... shhhhh, she's comming, better go........:whistle:

sabretoothtigger

Must be a mirage


Top end for gold is ?

On 21 January 1980 the Gold Fixing reached the price of $850, a figure not overtaken until 3 January 2008 when a new record of $865.35 per troy ounce was set in the a.m. Fixing.[1] However, when indexed for inflation, the 1980 high would equate to a price of $2398.21 in 2007 dollars, thus the 1980 record still holds in real terms.

mike22

jackdoor wrote: »

So, more or less a W then

It's all very well talking about the price of gold in $s, but the only price that really counts
is the one in the currency you're actually buying in - graphs etc. for this would be useful too.

Gold Am fixes on 4th Jan 08
$858.75 / £434.09

Gold Am fixes on 5th Jan 09 (1 year later)
$860.00 / £591.80

Hardly any increase in $, but if you were buying using £ then it's more than a 36% increase (or return if lucky!).

I sense this is because the £ was weak last year compared to $. But, I think it's recovering now. 1 U.S. dollar = 0.69 British pounds

Am I right?

cloud_dog

sabretoothtigger wrote: »

Must be a mirage

Sabre, I see what you're saying. I'm woundering if the timescale involved in the 'double-bottom' is big enough to really put in solid support. As I said my charting skills are still somewhat limited.

jackdoor, you are correct that in value terms the relevance is in your local currency. Unfortunately the generally accepted denominator around the world is in dollars, and I believe the US (USD) is still the largest purchaser of gold, so for these reasons I look at support / resistence in terms of dollars and dollar denominated info.

cloud_dog

cloud_dog

mike22 wrote: »

I sense this is because the £ was weak last year compared to $. But, I think it's recovering now. 1 U.S. dollar = 0.69 British pounds

Am I right?

Asolutely. I saw a reasonable shift in the exchange rate yesterday when I was monitoring the price. At some point during the day (midday ish in the US) the price of gold didn't change but my GBP value decreased by 25GBP. A bit annoying when the price is going up and up and then all of a sudden your invested value goes down - a tad annoying.

bubblesmoney

the USDX which has a bearing on commodities prices and also return on investment for foreign investors in usa.

although the short term USDX trend looks ok on paper, but if you see the longer term view the USDX has recently hit historic lows. obviously this means that the return on investments in usa for foreigners is down quite a bit compared to 1973 dollars. this is excluding the losses on the share market in usa or in property. i gather this is the 1st time in history that the USDX has broken the 80 barrier. i know it has rallied again in the short term but i think the long term outlook is poor considering quantitative easing occurring massively in the usa, plus loads of debt issues occuring decreasing yields to effectively negative values for the investor.

with inflation gold (and commodities in general) have a better chance of holding their value unlike all fiat currencies. so i feel the USDX rally will be short lived as any investor worth his salt will not want to be in a losing investment. this applies especially to foreign investors in usa, they will with time try to diversify into other more profitable venues or to get into commodities like gold to preserve the value of their investments.

just like any individuals good investment portfolio will be diversied rather than having the bulk in dollars, i feel the same opinion will be taken by many countries regarding their investments.

already the chinese have been muttering about protecting their investments. most of the asian central banks have very low holdings of gold, if they even increase their diversification into gold by small percentage each then this will push up gold prices much higher easily due to the supply bottle neck in gold, unlike in fiat currencies who can rapidly inflate their numbers with the snap of a politicians fingers like is happening now.

commodities will be the obvious choice for investments if they dont find any venues in other currencies or bonds that give higher yields.

but it is scary seeing the gold rise on this chart in comparison to DJIA
http://stockcharts.com/charts/historical/Print/djiagold1980print.html

but still the DJIA / gold ratio is 7.3 as of today and it has touched just above 1 as of 1982 !!!! and a ratio of 4 at other times.

so with many things being wrong with the economy and the only 'savior' being touted being 'more debt' i feel even if there are short term falls in gold it will continue to rise and the will be diversification of assets away from the dollar with consequent effects for the usa share market and the world share markets in general for the next few years at the least.

if obama goes the way of FDR in cornering gold in usa then the dollar will be toast as will any confidence in the usa by most other countries. i feel obama will play the game of quantitaive easing till he can find a better idea, so that he can get a second term. his prime instincts are on a second term, hence much of the funds being spent in 2011 the year before the next election. after that he will still have 4 more years then the rest of his life to wallow being an ex-president with attendant luxuries irrespective of his contribution. he is smart enough not to screw up his re-election chances in 2012, so he will do anything and everything to keep his ship afloat till after the next election.

regarding gold mining stocks i found this view interesting

We do need to add a note of caution though as the DOW is testing support at the 7500 level and had a poor day today when it dropped 297 points or 3.79%. If the broader does sell off hard and fast we may be caught once again in the down draft. The next week or two will be interesting and should also confirm or not that the gold stocks are moving in unison with the metal.
Keep an eye on these three players along with the USD and the price of oil when determining your next trade.