Commodity Trade Mantra

Posts Tagged ‘Gold Investors’

The Fed will not raise rates for the fun of it. The Fed wants to keep inflation under control, but what the organization really wants is negative real rates. That’s where inflation is higher than nominal rates. It does the Fed no good to raise rates unless inflation is going up even faster. Yet that’s exactly when gold does its job of preserving wealth.

The gold market is starting to look extremely oversold, so what does this mean for gold focused investor? For those with a more aggressive investment philosophy, a stomach for buying dips at support levels and a strong conviction that gold is going higher in the long term, the next few weeks may offer up a good buying opportunity.

3 Aces that will Fuel the most Powerful Bull Market in Gold

3 Aces that make the case for a massive leap in the price of gold… Three pivotal factors—that you’d never hear about from the mainstream financial media—will coincide by the end of this year to provide a historic boon to gold prices. The bottom line is this “trifecta” of gold events is creating a once-in-a-lifetime setup for gold investors. One that will see the price of gold explode higher.

Is Now the Best Entry Point for Gold Investors?

Gold was hammered down while Chinese markets were closed in the prior week, triggering a technical buy signal and possibly the best entry point in over a year to add to positions. Is now the best entry point for gold investors? Yes. Faster U.S. inflation and low interest rates will support gold. Gold always performs best when nobody thinks you should own it.

The Major Catalysts That Influence Gold Prices

Physical gold had its best quarterly gain in 30 years during the first quarter, and year-to-date, even with its recent swoon, physical gold is higher by roughly $200 an ounce. Gold has firmly reestablished itself as being in a bull market. The factors that move gold prices are largely unknown or overlooked. Let’s have a look at the seven most common factors that influence physical gold prices.

Rate Hike Largely Priced into Gold and Silver - What about Rationality in Sell-off?

Could the FED finally raise rates before 2016 draws to a close? That sounds plausible in theory, but there are a number of factors that do not support a rate hike in the near term. But even if they do hike rates, this move is already largely priced into gold and silver. We should question the rationality of this sell off. After all, the gold price often moves higher along with interest rates.

Gold Remains a Mandatory Portfolio Asset

Can the US financial system endure normalization of interest rate structures? No. Gold will remain a productive portfolio-diversifying asset until the process of debt rationalization is allowed to proceed in the US. Given implications for declining intrinsic value of US financial assets, as well as ongoing Fed efforts to debase outstanding obligations, gold remains a mandatory portfolio asset.

Issues that drove Gold Prices to all-time highs in 2011 Have Only Worsened

In 2011 there was an entire narrative around the gold market, when gold was at $1,900 & it was partly about US markets. The narrative in 2011 was that U.S. Federal Government on-balance sheet liabilities, at $16 trillion & the off-balance sheet liabilities of $55 trillion were unsustainable. Today, they are estimated at $19 trillion & $90 trillion respectively. Worsened enough?

Are Gold and Silver still Trending up or Vulnerable to some Profit-Taking Yet?

Before you rush to buy into gold-backed ETFs, it’s wise to note that there are signs of profit-taking in gold. Gold and silver tend to move together. Investors monitor the gold-to-silver ratio to assess how expensive or cheap silver is, relative to gold, currently seen at around 70 – near the upper end of the range between 45 and 80. This tells us that silver is still cheap compared to gold.

The 7 Signs That the Gold Market Remains Resilient

It is possible that gold and silver prices continue slipping, especially with futures expiration close-by. But the mildness of the pullbacks witnessed so far in 2016 are a testament to just how resilient gold has been. Buyers are stepping up to buy the dips rather than panic out of their positions. There’s a strong conviction in gold investors for the first time in 5 years, that gold’s new bull cycle has just started.

Unwinding of Excessive Gold Futures Longs - One of the Best Buying Opportunities

Gold sees major interim tops in bulls and bears alike whenever speculators’ long positions surge up to relatively-high levels. While these elite traders don’t control gold’s long-term trends driven by fundamentals, their collective trading can sure bully gold over the short term. The unwinding of speculators’ excessive gold futures longs offers some of the best mid-bull buying opportunities.

The Rally in Gold Prices is Just Getting Started

It’s been a stellar six months for gold investors. The yellow metal has surged 28% year-to-date, its best first half of the year since 1974. And now there are signs that the rally is just getting started. About $10 trillion worth of global government debt now carry historically low or negative yields are contributing to gold’s attractiveness right now & pushing it up on a new bull run.

Silver Takes the Gold Prize: Commodities Half Yearly Report 2016

Caused by worries of a summer interest rate hike and uptick in the U.S. dollar, gold and silver both stalled in May but have since rallied on the back of Brexit and with government bond yields in freefall. This has been highly constructive for gold and silver, as yields and precious metals tend to be inversely related. As for silver, some forecasters place it at between $25 and $32 an ounce by year’s end.

Divide Global Money Supply by Global Physical Gold = Correct Gold Price

It’s true that there’s a limited quantity of gold. But there’s always enough gold to support the financial system. It’s also important to set its price correctly and there can be a debate about the proper gold price. Just take the amount of money supply in the world, the amount of physical gold in the world, divide one by the other, and there’s the gold price. It’s not complicated mathematics.

Gold and Silver Go Ballistic on Panic Buying as Paper Assets Crumble

There’s a lot of people out there now who are thinking, “Do I have enough gold and silver? Should I buy some more here?” And if the price goes up a lot of them are going to panic and think, “Well, if I’m ever going to get it I got to pay today’s price,” and so they jump in and they buy, and that gives whatever kind of move that’s happening some extra momentum.

Has Gold Already Priced-In a Fed Interest Rate Hike?

Gold already started correcting following the Fed’s fear-provoking announcement that it might raise rates in mid-June. The announcement lifted the US dollar 0.8% & sent gold down 2%, but the change is still within trend. Is there more downside ahead? Likely yes. Gold is seasonally weak in June. The lead-up to June 15 might be more significant than the event itself.

Why Investors See Higher Gold Prices In 2016 - Here Are Six Reasons

Precious metals remain the 2016 commodity leaders, with silver posting a huge 25% gain & gold prices showing a 21% rise. The year is off to a good start for gold investors. But, the party may have just begun. A bevy of economic, monetary, currency and technical factors continue to develop in gold’s favor, which argue for the potential for higher gold prices in 2016.

How China will Continue to Gain Influence in the World Gold Market

The gold market will soon be very different than from what we see today, largely due to the current developments in China. China’s influence will impact not just gold investors but everyone who has a vested interest in the global economy, stock markets, & US dollar. The Chinese understand that owning gold means economic power, & are accumulating both at a rapid rate.

Silver Hasn’t Flashed This “Buy” Signal in Almost a Decade

Since peaking in 2011, silver had dropped 72%…far more than gold’s 45% drop. An asset carves a bottom when it stops falling, forms a bottom for a period of time & starts moving higher. This signals that buyers have stepped in and given the price a “floor. Like gold, silver has now completed its carved bottom. We think gold is heading much higher, but silver could go even higher.

Central Banks are Buying Gold and Hedging Against their Own Policies

It is not surprising that central banks were adding to their gold reserves in 2015, but it is interesting that central banks have been on an unprecedented spree of creating money out of thin air. So while many investors were not enthusiastic about gold, central bankers saw a need. It seems that central bankers who are buying gold are hedging against their own policies.

No One Believes in Gold. Here's Why It Will Keep Rising

While gold and miners continue to consolidate, we’re beginning to see new trading setups emerge on the long side. The rise in gold prices won’t be picture-perfect. Expect wild swings and plenty of shakeouts. Comeback moves are never clean or easy. But they are powerful—and they can put a lot of money in your pocket in a very short amount of time.

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