All I can say is that no-one knows what the gold price is likely to be in 2 to 3 years time, everyone can only guess, including you and me, and I expect we each have a 50-50 chance of being correct or not.
The only people I would be wary of are those extreme rampers and down-rampers, because history says that the result it's likely to always be somewhere in the middle. And if anything, we should learn from history.
We also know that international politics and economics is volatile, and that world markets are increasingly being manipulated. This is obviously being verified by the increasing number of prosecutions occurring world-wide by national securities and investments commissions.
So, we can only look at the statistics, and attempt to make an objective judgement from them.
I spent years at a university applying statistics, and learnt that even then, nothing is infallible.
The best statistician in the world is only getting the markets right on less than 70% of occasions, so this has to tell you something, and obviously how difficult it is to time markets, and how it's becoming even more difficult because of the advent of algorithmic trading and artificial intelligence, both of which are paradigms that very often pay no attention at all to fundamental economics, nor do they need to.
I can only offer my opinion, like you will, given the current macro trends.
Unfortunately, what I would like, is currently different to what I see.
I would like gold to be at $2,000 USD, but given all my research, I don't see it getting much above $1,300 USD at peaks over the coming years, and there are some very reasonable and logical arguments for this. I expect gold to average about $1,200 USD for the next 3 to 5 years, right out to 2023.
The USA economy is improving, company profits are on the up (during recent reporting season), inflation is contained, USA employment is growing, property investment is increasing, as is house prices in the USA, and the Fed is raising interest rates, and the Fed is not going to re-start QE or anything like it in the coming years, bank interest rates are low, and the period of cheap money printing has come to an end. ALL of these things will keep the gold price down (relatively).
And the gold price is determined the world's largest economies, particularly the USA.
There may be some international political tensions that give the gold price the occasion lift, but compared to the above factors, the (periodic) gold price spikes should be short lived.
The only place to invest in gold in the coming years IMHO, is in economies with a falling dollar relative to the USD, like the Australian dollar. Australia is the only country I would invest in gold. Have a look at the USA gold companies, in places like Nevada (the gold hub of the USA), they have been crucified, while our gold companies in Australia have made positive moves - and there is only one reason for this, it's because of the falling Australian dollar.
All the gold investors here in Oz (including me) want to keep praying that the Aussie dollar continues to fall, otherwise our gold companies will follow the USA.
I dislike these sentiments and statistics, because I am a gold bug. I love gold more than any other investment. I love everything about gold, but as they say, "... the facts are the facts...".
There is an analyst who always famously quotes that we should remove sentiment, remove emotion, remove bias of any form, and just "... follow the tape...".
If any reasonable person, whether FA or TA focused, actually and objectively does this, then I contend their conclusions cannot be far removed from those I have expressed. But this is a current opinion only, because we live in a fast changing and volatile world.
However, in this volatile world, trends can change very quickly, especially when things like war can come out of nowhere, so there are always caveats, and question marks going into the future.
The markets can be manipulated. The markets are corrupt. The markets are a casino. Just look at gold, and the absurd international marketplace, and the number of investigations and prosecutions of those attempting to manipulate the spot price.
We have more people and funds these days trading "... paper gold..." than physical gold. In other words, they are actually trading ounces of gold that do not currently exist, and may never exist. In effect, they are trading virtual gold.
Any (supposedly) fair and reasonable society that permits such a system, is endemically cancerous at it's centre, and will in time, like the roman state, collapse and be destroyed because of it's own inequity and corruption. However, by that time, I will (hopefully) be well gone from this world.
Good luck my friends.
Gw
WAF Price at posting:
32.0¢ Sentiment: None Disclosure: Held
(20min delay)
