The price of gold bullion has been in a powerful uptrend rising from $1,600 to $1,800 an ounce in the course of a month. That was good for more than a 10 percent gain in 30 days, and that led to what I expect will continue to be short-term selling as investors lock in profits.
FastMarkets research analyst James Moore told TheStreet that gold prices could fall as low as $1,680 before consolidating and resuming the uptrend.
Gold hit an all-time record high of $1,817 an ounce last week as investors digested bad news. The U.S. lost its AAA credit rating, unemployment numbers got revised upward and consumer spending dipped.
The market did get some good news on Thursday, though, that helped alleviate smoldering fears of a double dip recession: jobless claims fell to a four-month low (per Reuters).
Fred’s best guess: The dip in demand for gold looks like an excellent buying opportunity, particularly if prices fall near $1,700 an ounce. I’m just not convinced that we’re out of the water yet.
The debate over the debt ceiling gave us a glimpse of just how bad the nation’s debt problem has become, and I’m convinced that we’re overly-optimistic on the job market.
Earlier today, The Atlantic posted an excellent chart showing that the unemployment rate is actually closer to 12.5 percent – not the 9.1 percent the government’s touting. Too many people have given up looking for a job altogether.
Consider this: over the past 60 years, the official U.S. unemployment rate has only hit 9 percent or higher for 43 months. Twenty-four of those 43 months have occurred since Obama took office. The economy’s in a dark place, and the debt crisis has taken a lot of ammo out of the government’s gun.
That’s not to say the U.S. is the only economy around the world that’s hurting. It’s a global problem, and it’s one that’s hitting currencies the hardest. The best way I’ve heard it described so far is this: We’re in a bear market for currencies.
Don’t buy that? Consider the recent news that the Swiss government’s considering pegging the value of its currency to the Euro! When the unflappable Swiss are considering inflation, the global economic train has jumped the rails.
And what’s bad for currencies is good for precious metals. Count me in the bullish camp for gold. Not because I love precious metals, but rather because I’m scared of the future for the dollar.
Related
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TECH BOOM
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JUST THE BEGINNING FOR GOLD
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CLEANING OUT YOUR DRAWERS
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BETTER THAN CRUDE?
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$30 MILLION A YEAR? THAT’S JUST THE COST OF DOING BUSINESS
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Tags: gold price, gold price forecast, gold price predictions
I bought silver bullion to protect my wealth from inflation. Insight for silver price for short term please. Thank you.