Gold Prices & Deflation
GOLD PRICES ARE ALSO RESPONDING TO PRICE DEFLATION
Current Market Trends in GOLD . . .
As described on this website by this author many times (in previous posts), the downtrend in the metals, INCLUDING GOLD & SILVER, is still in effect.
Over the last few weeks and unknown to most, GOLD has been breaking below it’s 5-Year Price Lows.
Yes, this is significant and, while it’s not all of the story, it gives good credence to a continuing loss of price momentum for this precious metal.
This latest round of price drop seems headed for a intermediate support around the $1,000 price area.
This will likely be only a temporary support at that as Gold heads still lower.
Another strong support area should manifest at $750, which, at the moment may seem un-achievable and, even ‘impossible’ with economic conditions as they are.
You can view these two support levels by looking at the horizontal red lines on the chart to the left.
This chart is important because it’s displaying a long-period of Time against which to judge present price levels.
Twenty-Years of price history is seldom looked at these days as the World of investing has been programming participants to pay attention to shorter-and-shorter time periods.
Attention spans have been steadily decreasing but, in the end, the mathematics of Time will come into play, finish the Game and establish a new major trend.
This Change will, unfortunately catch most unaware.
Old habits built upon even false information die very hard indeed.
I suspect that by now, after all the price abuse they’ve been through, that even the masses of gold buyers are finally waking up to the illusionary teachings on Gold that they’ve been exposed to these many years.
Most of their opinions these many years have been based on a false premise about what Gold actually is.
The economy will continue to show the truth about this in the months ahead if major trends continue to hold as they have.
Economic metals like Copper should be your Guide as this metal reveals the truth about the others mentioned above.
Copper will eventually signal a significant change in trend.
When it does, it will mean that industry is starting to pick up and the economy is growing again.
Until we see that sign however, we can expect Gold to also continue it’s decline.
It’s possible that each commodity will diverge, but, that hasn’t been the case since the Great Commodity High of 2011 and isn’t the way to bet this horse. – George