Gold Is In A Powerful Bull Market That Will Take It Multiples Of Its Current Price
The one-year gold futures chart and spot chart are extremely impressive.
They are in the classic long-term trend of going from the lower left to the upper right. Trends like this are multiple years in duration.
A key driver of gold is the debt crisis globally, led by the US in a Death Spiral of Debt that is on autopilot. The next president will be a massive spender and servicing the debt has surpassed military spending and will next surpass Medicare.
The Fed cutting by a half-point suggests the economy is heading toward troubled waters. A rate cutting cycle, which looks to be headed back toward the Free Money Era will be bearish for the US dollar and extremely bullish for gold.
The Fed is trying to sell the Goldilocks economy story which is incongruent with them doing an emergency level cut of a half-point. I can clearly see that it won’t be long before the Fed increases their balance sheet.
Another great aspect of the gold charts is that we are seeing a series of higher highs and higher lows. This is also a wonderful indicator of a long-term bullish trend.
I’m also liking what I see with the basing periods. We saw one early in the year, then a significant breakout above $2100. Another base happened in May-June followed by another significant breakout. There was another from the middle of August until early September, then a breakout that took gold to $2700.
The bases are getting tighter in the range and shorter in duration then the rallies after them are getting more powerful.
Until the middle of February, the gold stocks were in a long term bear market. So far, the gold miners have only come off the canvas and still have a lot of catching up to do to catch up to the gold bull market. They haven’t even started to price in the long-term trend for gold.
The gold mine developers haven’t really joined the gold bull market. Neither have the explorers with important discoveries.
We’ve been fortunate to be on top of some great picks in the gold stocks and I’m working on a report to update on our key gold stock picks.
All the best,
Allan Barry Laboucan
