$1700 Gold Projection
2oversold.com currently has a gold projection of $1700 before the markets will begin to stabilize and perhaps find some sort of bottom.
Now let me remind our readers that we are not experts in the markets. We use simple common sense on this site and in our blogs. This projection is based partly on our opinion that the DOW is going to test the 6500 level before we can hope to see any sort of market support.
Until today we have seen the price of the precious metal trade pretty much in tandem with the overall markets. As the economy continued to weaken and the news from all sectors continues to get worse we felt a decoupling of gold from the markets was inevitable. I think we saw the beginning of this process today.
Today all the major indices traded sharply lower while gold and silver rallied strongly. Not only did we expect this to happen but we also think this is the beginning of a long and strong bull market in the metals in which they will assume market leadership.
If in fact the gold bull is now entering the spotlight, we can expect the support for a sustained rally to be continued economic weakness in the world markets, with both the big money and small investors seeking investments in the precious metal.
I think for the most part many investors still have a belief that either the bailouts, or stimulus plan will put everything back on the right track. In time this may turn out to be true. But for now there is no magic bullet that is going to fix our situation and as this becomes more evident I think we will see more interest in both the precious metal and the companies mining it.
2oversold.com currently blogs three gold related companies. They are Yamana Gold (AUY), Northgate Minerals (NXG) , and Western Goldfields (WGW) .
Each of the links above are to the first blog about each company. The date of the blog and the price that company was trading at on the day of the blog is included in each blog. This is done so that each individual can decide for themselves if there is any value or upside remaining at any given time.
2oversold.com does not make any recommendations on the above companies. These are companies that we found a reason to blog about at the time and continue to do so today.
2oversold.com is a blog for the individual consumer and private investor. We are not experts in the markets nor do we make any recommendations of any company. The companies we blog about are discussed for the purposes of this blog only and this should not be considered as investment advice.
Your gold projection of $1,700 in intermediate term is too high. At this moment
we are at the top of a second leg in fifth and last wave reaching $1050 and third leg should finished at $1,260. This calculation is also supported by Fibonacci extention
of 1.618 of first and/or third wave as fifth and last waves usually do. Intermediate
top of gold price might be very well $1,260.
Gold chart
Hi Marian,
I have no doubt you are probably correct. However notice the 1st paragraph:
RE: 2oversold.com currently has a gold projection of $1700 before the markets will begin to stabilize and perhaps find some sort of bottom.
We really blog about the markets in general and not on any specific time period. Our Gold Projection has no time frame with the exception “until the markets can begin to stabilize”.
In other words we think Gold will hit the $1700 price before our economy recovers from the current crisis.
Thanks for the link. I think that is one of the best sites for charts and graphs and although I do not use them I know most investors do.
Agree, this way my calculations came up to $1,804 as a top price level of gold when
we would start to see a bottom of this financial squeeze. What is a puzzle in this scenario is how US Dollar and other world leading currencies will survive higher as expected inflation and their inpact into price of gold? I mean my calculations take
existing level of inflation into consideration automatically, in case we will have higher level of inflation as of today, gold could go much higher.
Marian,
I would appreciate your opinion on the news that “the recession might end this year”. I have voiced my opinion in a couple of blogs and in short I think it was a move to try and slow down the slide the markets were seeing. I simply can not believe that Fed Chairman Bernanke would have issued such a statement.
Now of course he did put in the “if banks stimulus works…ect” and left himself some wiggle room. But in your opinion what was that all about?
Again thanks for the post and your gold projection.
$1700 may not be that far off. Here is a Business Week article that says we will see $1500 gold:
BusinessWeek
Gold’s Luster Outshines Rising Prices
Friday February 27, 8:08 am ET
The price of gold rose above the $1,000 mark on Feb. 20, a level it last reached in March 2008. And though prices have swelled 40% since a $712 low last November, now isn’t the time to sell, according to David Galland, managing director of Casey Research. “You’ll probably see $1,500 this year,” he says, as investors favor the precious metal over paper currencies. “You can only mine so much gold in a given year. Dollars can be created in the blink of the eye and with the signing of the pen.” Historically, $1,000 an ounce isn’t even that high, says Galland. Gold’s 1980 peak of $850 would equal $2,300 in today’s dollars. That makes $1,000 gold seem cheap; a recent Bloomberg survey of traders, investors, and analysts found that 71% still say $1,000 rates a buy.
http://biz.yahoo.com/bizwk/090227/0910b4122063020816.html?.v=1
Gold is going to retest $825. Check this chart.
http://www.the-privateer.com/chart/usgold2.html