Gold is cheap

The relationship between the gold price and the performance of gold stocks is always volatile. In theory gold stocks should outperform when the physical metal is rising, a sort of amplification play. In practice, no such certainties apply, principally because there are operational issues to consider, plus often unknowns in terms of the reserves. It is thus firmly in the


Chart of the Day: Gold ETF

Following from yesterday’s conversation about the direction for gold, today’s chart comes from the most recent weekly commodity report from Standard Bank, available on the Kitco website. A bit of explanation is in order. An ETF – an exchanged traded fund – is a structured product that holds a set of assets like stocks or


Bearing the bull on gold

Coming out of the new year, alongside other risk assets, gold has seemingly reversed its recent falls, climbing above $1620 as risk managers and robotic algo’s bid up risk on sentiment expectations from consensus building and reaction to continued positive dataflow from the US economy as 2012 gets underway. As always, the sentiment behind gold’s rise


Getting gold wrong

I generally don’t mind a bit of the AFR’s commodities commentator, Stephen Wyatt. But today he shows a complete lack of insight into the dynamics that drive the gold market claiming that: Gold is behaving badly. It’s supposed to be a safe-haven asset but, just when the global economy looks like going to hell in


Gold blows up

Gold last night was the vanguard in a wide retreat of undollar risk assets, falling over 5% to settle at $1574USD per ounce before the Asian spot session opens shortly this morning. As I prefaced in my Trading Day posts this week, on Monday it had appeared the precious metal had formed a reversal head


Chart of the Day: Gold is running out of time?

Today’s chart comes from the McClellan Market Report (via Pragmatic Capitalism) and implies that the secular bull market in gold has several more years of outperformance over the equity market. Using this Dow Jones to Gold ratio, the previous two secular bull markets where gold dominated were of 13 to 14 years duration and occurred


Chart of the Day: Gold at $2000 AUD oz?

Today’s chart is inspired by a conversation with the The Bullion Baron’s whose blog has been successful in forecasting the price of gold – but in AUD instead of the oft-quoted price in USD. The dynamics between the USD, the AUD and gold are interesting, to say the least. We have seen how risk assets


The gold bubble bursts!

There, I said it. I wanted to get that out of the way before a Pascometer or similar gold skeptic stole the punchline. So, is it true? In my view, no. There’s a simple reason for why not. Gold wasn’t in a bubble in the first place. A bubble is formed when people buy an


Chart of the Day: Cop(per) this, gold

Today’s chart starts with Colin Twigg’s trading diary, analysing the technical breakdown of copper: Colin estimates a target of 7000, which puts the base metal at or slightly above its pre-QE2 price, taking the “froth” off the top. In the case of a Western recession, however, the price target is more likely far far below –


Chart of the Day: gold correction

Given last night’s undollar crash included an immense correction in gold, which was called by House and Holes here, I thought Data Diary’s chart on gold vs the USD is timely and convincing. First, here’s what happened in the last 3 days of trading gold, note the wild trading range: Here’s my technical chart of


Gold looks vulnerable

I am of the view that the bull market in gold is far from over. To me, it’s obvious that so long as the fiscal and monetary frameworks that support the $US are in chaos, then gold fundamentals are strong. Arguments over the value of the metal are irrelevant. You can’t price chaos. This is


The ‘gold bubble’ meme

Some folks just don’t get it. According to The Intelligent Investor at the SMH today, gold is approaching its top because: “a German company, already with operations in Europe and the United States, was brining a ‘gold-to-go’ self-service machine to shopping centres, hotels and airports. Everyday shoppers and travellers worried that modern economies were on


Gold falls – to last week’s price

I’ve been following the gold price on MacroBusiness for sometime now, with my most recent piece a few weeks ago (and other comprehensive posts here and here) I placed the context of the move in the gold price in a weekly chart. Here is a better and larger view of that chart (click to enlarge


Where to for Gold?

Time for another update, with the latest surge above $1600 USD per ounce last night. As I mentioned briefly in my last update, where to for gold? First a quick recap – here is the current price activity within the context of a major, long term bull market. And here we are today (using daily


The rampaging golden bull

With gold almost rising to a new all time high in USD per ounce (Europeans get that tag for today) it’s time for another close look at the shiny metal. This will be a technical and chart heavy look at gold from a fractal viewpoint – i.e from the very long term (secular), then long


Where now for Gold?

Spot gold in USD broke a recent high last night, after comments by the Fed chief Ben Bernanke, that milky-wilkies (QE3) are off the table, but will continue its zero interest rate policy (ZIRP) due to the slowing US economy. Gold jumped to $1559.50, before being sold off (which has regularly occurred whenever an intraday


The gold vigil

I’ve said before that investing is more about psychology than about fundamental valuations, numbers and metrics. In the case of residential property’s evil “twin” brother, gold, this is more true than ever. Regular readers know that I am watching out for signs of the current bull market in gold becoming an out of control bubble.


Gold: This Time is Different

Asset markets are effectively all the same: housing, shares, commodities, FX, precious metals, pork bellies and interest rates. They are all markets for speculators to trade, investors to get a return of and on their money and sheep to think they can buy and hold (or negative gear) forever. As I’ve said before, gold in


Gold to break through $US1500 an ounce?

Gold looks like breaking through the $US1500 an ounce level in overnight trading. This new nominal historic high comes as no surprise due to the metals relentless march upwards in a primary bull market that has lasted 10 years. What is surprising is golds recent correlation with all other risk assets (e.g equity markets, commodities


Golden rocket

As gold again surged to record highs last night on dovish Bernanke comments and weak data, it’s time to revisit the rally. I first began recommending gold to anyone that would listen in early 2001. I was laughed at. Later that year, my friends laughed at me again. This time, it was a running joke


Gold moves to next bubble phase?

Investing and speculating in gold is almost as emotive a subject as residential property, so I’ll try to keep this short and sweet. I treat physical gold as a “Type Zero” security asset, a small insurance hedge against financial instability – a “Minsky Metal”. (I will publish an article regarding my research into the “Minsky


Gold: Global currencies and demand

Guest post from The Bullion Baron An interesting article was posted on Mineweb earlier this week comparing the performance of Gold over several currencies. The 4 currencies it was compared in were the US Dollar, Renminbi, Indian Rupee and Euro. With the growth of three tied so closely it was almost just a comparison of