Has the dead cat finished bouncing?

Prism

EdGasketTheSecond said:

ColdIron said:

In the words of the Irishman when asked for directions - Well I wouldn't start from here

And I say that as someone who is positive about gold. Just not now

https://www.bullionbypost.co.uk/gold-price/5-year-gold-price-chart/

The chart is in GBP so you are also looking at the fall in GBP against USD. Also if you take a 10 yr chart you find that gold is $200 below it's all time high. Rookie errors.

A UK investor has to price things in £ as that is the currency they buy in. So due to the significant drops in the pound recently, everything priced in $ including gold and US equities are pretty expensive. Its benefited those previously invested but not so much for those thinking of buying in now. The $ price is relevant but not as much as the £ price for an actual investor.

Sailtheworld

EdGasketTheSecond said:

Sailtheworld said:

EdGasketTheSecond said:

Malthusian said:

The macroeconomic circumstances for gold were also very favourable during the last market crash, when the banking system was collapsing, the debt bubble was bursting, global trade had ground to a halt, a decade of recession was underway, etc etc, and only shiny metal could protect you from quantitive easing. That worked out well for gold and gold stocks, didn't it. (L&G Gold Mining ETF +35%, S&P GSCI Gold Spot +117%, FTSE World +321% since March 2009.)

Yes gold was a very good investment during and after the 2008 crash too. It went from $730 to $1920 over 2 years +116%, during the same period gold stocks rose 200%. Of course you don't hold them once their relative value changes to other asset classes or the fundamentals are no longer supportive of gold so your figures from 2009 to today are not relevant to whether you should be holding gold and gold stocks now.

You've said this before. There's no special ratio of gold to stock prices that indicates a good time to buy and sell unless only a select few somehow know about it. Otherwise it would be priced in - why would anyone buy if the ratio says they should be selling and vice versa.

It is because the market misprices things. If that were not so then there would be no crashes or bounces up; it would just gradually and slowly rise. Fact is fear and greed drive the price of assets and they invariably go from boom to bust. You can go back through history and analyse these cycles that change from stocks to real estate to commodities. If you are in the right asset class at the right time you will do far better than sticking with one asset class all the time.

It's the other way around. If there were special ratios that reliably told you when something was mispriced that would actually smooth the graph because it would become priced in. Any such ratio that worked would provide an investment edge only if it was a kept secret from other market participants otherwise you wouldn't be able to front run the market.

Completely agree that concentrating capital in the right asset class at the right time is going to lead to riches. If you know when to hop from one to the other then you have a talent. A test of whether you're acting on gut feel (which is fine if your gut is reliable) or a logic based approach is to lay out the conditions that determine the point you'll sell gold and inform you what to do with the cash. 

bowlhead99

EdGasketTheSecond said:

ColdIron said:

In the words of the Irishman when asked for directions - Well I wouldn't start from here

And I say that as someone who is positive about gold. Just not now

https://www.bullionbypost.co.uk/gold-price/5-year-gold-price-chart/

The chart is in GBP so you are also looking at the fall in GBP against USD. 

Really what you are looking at is the fall in GBP against gold, which is another way of saying the rise in gold against GBP, which is what is being plotted on the chart. If you have pounds and are considering exchanging them for a commodity - for the inherent 'worthiness' of buying the commodity - it doesn't really matter what that commodity is priced at in dollars, yen, rupees, yuan, won, euro etc, as those other prices are simply determined by spot rates from time to time.  A block of gold isn't inherently 'American', just because it is more popular to quote its price in USD rather than 100 other currencies

The fall in GBP against other currencies and assets is a minor component of it, and was pretty much dealt with during the price change seen in the second half of 2016, where the gold price went up from ~£860 to ~£1000 in the five months after the referendum at the same time as a dollar went up from the 70p range to the 80p range. The chart showed a more than doubling of gold while sterling only depreciated 15% against a basket of other currencies, so most of the fact that gold got more expensive is not attributed to the depreciation of the pound.

Also if you take a 10 yr chart you find that gold is $200 below it's all time high. 

If a commodity can be shown on a five year chart to literally double in price (from £700 to £1400) and still be lower than its all time high achieved in the previous five years, it doesn't say much for its stability, or for the prospects of buying into it as other mainstream assets recover in price and desirability.

Rookie errors.

lol

MaxiRobriguez

My gut feel:

Markets are still pricing in a return to normality for business, but haven't considered impact on cultural changes or 30 million more Americans not spending. Prices are being pumped with liquidity but we'll need to see some sort of corporate profit resiliency for prices to hold.

I think we'll soon get to a point whereby every asset class price changes stabilise awaiting what happens next.

I think I'd sell into any specific rallies on travel companies (TUI 50%+ rise yesterday being the main obvious example) and buy any dips on consumer staple companies with decent balance sheets. Drip feeding in probably easiest thing to do at the moment, and keep a % back as cash.

D.L

I'm 50% sure that things will go up from here.

Sailtheworld

Missing - Reward
My !!!!!! has been missing for two months. Reported by some observers to be deceased and in a short lived bounce as if dropped from height. However, it appears to have been full of vigour and has leapt up and kept going. up. I know it will come back one day but can anyone tell me when?

2unlimited91

Sailtheworld said:

Missing - Reward
My !!!!!! has been missing for two months. Reported by some observers to be deceased and in a short lived bounce as if dropped from height. However, it appears to have been full of vigour and has leapt up and kept going. up. I know it will come back one day but can anyone tell me when?

Is this your !!!!!!?

Sailtheworld

Could be - certainly seems to be on a mission to uncharted space

Prism

Looks like another up day for me. I think is is going to be my best ever calendar month - not that it matters at all in the long run. 

takesyourchances

Prism said:

Looks like another up day for me. I think is is going to be my best ever calendar month - not that it matters at all in the long run. 

It just shows how unpredictable the market's are and keeping to a steady consistent plan I just invest as much as I can each month and have not changed anything as in for the long term too. I didn't expect my investments to be back were they are now so quickly but know it can change the other way as quick but sticking to a plan in all conditions helps