Gold Is Heading For $1500 And This Time It’s for Real Different

Gold-Heading-For-1500

A gold IRA is a type of IRA that allows the investor to own physical gold, silver, platinum and palladium instead of the standard paper trail asset that can be sucked up by corruption in a matter of minutes, leaving the investor with nothing. Gold IRA has not only become mainstream, it comes highly recommended by many gurus of investing including Peter Schiff.

Gold is heading for $1500, but there seems to be a different ‘feel’ this time around. There is a bullish Fibonacci retracement and the overall economic fundamentals seems to point in that direction.

KEY TAKEAWAYS:

  • Gold has made quite a run and some bears argue that it will correct at least 300 points because of a commodity bear super cycle.
  • Despite the long-term double top pattern in gold, one should not automatically presume that crowd behavior will react in a similar manner.
  • This time it really is different as the underlying economic fundamentals support higher gold prices.
  • Currently, gold is in the midst of a bullish Fibonacci retracement and its next target is $1500.

So if you are still hedging on whether or not to make gold part of your retirement plan, think again. When you do make the commitment of gold, make sure you do a thorough comparison of the best Gold IRA custodians.

Original source: http://seekingalpha.com/article/3986944-gold-headed-1500-time-really-different

Expect Higher Gold Prices In 2015

(David Levenstein) Interestingly, while softer oil prices have usually had a negative impact on gold prices, as it hurt gold’s appeal as a hedge against oil-led inflation, the price of gold has remained firm even though the price of crude oil has slumped to fresh five year lows.

Gold prices have been on an incredible roller-coaster ride over the past couple months, whipsawing like crazy. And contrary to popular main stream propaganda, the price volatility has had had absolutely nothing to do with fundamentals. Prices have been driven down by speculators on Comex who have been able to use huge short positions to short gold futures.

While the downside of their action is creating a distorted and unrealistic price for gold, the lower price is creating a wonderful opportunity to buy.

The prices of Brent crude and West Texas Intermediate have plummeted over the last few months.

Both Brent and WTI tumbled 18% in November as the Organization of Petroleum Exporting Countries decided to maintain its 30 million-barrel-a-day output target. Crude has traded in a bear market since October amid the fastest pace of U.S. production in three decades, rising output from OPEC and signs of weakening global demand.

OPEC, responsible for about 40% of the world’s oil supply, pumped 30.6 million barrels a day in November, above the 30 million target for a sixth month, according to data compiled by Bloomberg

Last Thursday, the price of gold came under some selling pressure once again, when the European Central Bank (ECB) said it wouldn’t consider adding to bullion purchases. However, the price of the yellow metal pared earlier losses as the euro rebounded against the dollar after the ECB chief Mario Draghi said the bank would re-evaluate the case for more monetary stimulus next year.

The ECB announced that it will maintain interest rates at current levels. The central bank cut its 2014 growth forecast for the Eurozone to 0.8% from the 0.9% it was predicting three months ago. The downgrades were sharper for 2015 and 2016. Growth next year is expected to be 1%, down from the earlier forecast of 1.6%, while the 2016 forecast was cut to 1.5% from 1.9%.

The ECB also lowered its inflation target following steep falls in the oil price with the annual rate expected to be just 1.6% even in 2016, still below its target of close to but below 2%. Eurozone inflation is currently just 0.3%.

In the press conference after the announcement, Draghi confirmed that the central bank will not buy gold as part of its asset-backed purchase program. When asked what types of assets the governing council would buy as part of its quantitative easing program, he said that the central bank will consider a package of broad-based asset purchases including sovereign debt but not gold. “We discussed all assets but gold,” he said.

Draghi also emphasized that more time is needed to gauge the effect of prior stimulus and the need for additional easing. He noted that ECB will reassess the policies early next year and “it doesn’t mean at the next meeting”.

In simple terms this means that the ECB will willingly buy toxic assets including Greek bank CDOs, Italian bonds—despite the fact that the EU’s fourth largest economy, was downgraded to just a single notch above junk by S&P on Friday, Spanish condo HELOCs, and Portuguese Used-Car ABS… but absolutely not gold. This is in sharp contrast to what the Chinese and Russians are doing which is buying massive amounts of physical gold.

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Robust Demand for Physical Gold Support Prices

(H/T Gold Silver Worlds)

Gold prices climbed to their highest level since Sept. 10 last week, breaking above the $1,250 an ounce level.

Gold’s outlook this week will depend largely on the Federal Reserve policy meeting, when the U.S. central bank is widely expected to end its bond-buying stimulus. The Fed’s two-day meeting, which begins today will also be watched for clues on whether any slowdown in Europe or elsewhere could affect the central bank’s monetary policy.

On Monday, October 27, some of the biggest financial news of the year made huge waves all over Asia. Yet in the Western press, this hugely important event was barely even been mentioned.

The Chinese government announced that the Renminbi or Yuan will become directly convertible with the Singapore dollar effective Tuesday, marking another step toward internationalizing the Chinese currency.

The announcement by China Foreign Exchange Trading System (CFETS) extended the yuan’s list of direct onshore trade to more major currencies, including the U.S. dollar, the euro, British sterling, Japanese yen, Australian dollar, New Zealand dollar, Malaysian ringgit and Russian rouble.

With direct trading of their currencies, China and Singapore will be less dependent on the U.S. dollar to settle bilateral trade and investment deals.

Previously, the exchange rate between the two currencies was calculated based on the yuan-U.S. dollar central parity rate and the Singapore dollar-U.S. dollar rate.

Now that the two currencies can be directly traded, the yuan-Singapore dollar rate will be set based on the average prices offered by market makers before the opening of the interbank foreign exchange market.

The Chinese government is gradually relaxing its hold over the yuan and making it a global reserve currency.

China is also under pressure to diversify its foreign exchange reserves, which stood at 3.89 trillion U.S. dollars at the end of June.

According to the Society for Worldwide Interbank Financial Telecommunication (SWIFT), international bank payments denominated in yuan have nearly tripled in value in the past two years.

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Gold Prices Rally Strongly amid Falling Equities

(H/T Gold Silver Worlds)

The price of gold rebounded from its 15-month low last week to see its biggest weekly gain in four months. After failing to break below a key support level at $1180 an ounce the price of gold rallied higher for the first time in a long while last week, with gold bouncing $32 (2.7%) to close out the week at $1223 an ounce.

The price of the yellow metal has begun this week on a firmer note as prices extend last weeks’ gains. At the time of writing the price of spot gold was trading at $1233 an ounce after pushing through $1230 an ounce on Monday and hitting a four-week high as traders covered short positions while some bargain hunters stepped in to buy at the current low levels.

Meanwhile global equities have fallen. The Standard & Poor’s 500 Index experienced its worst three-day loss since 2011 as it fell an additional 1.6% on Monday to 1,874.82 at 4 p.m. in New York, the lowest since May and closing below its 200-day moving average for the first time since 2012. The Dow Jones Industrial Average lost 1.4% to a six-month low. Brent crude tumbled 1.5% after sliding into a bear market last week. The dollar weakened against most of its 16 major counterparts and gold gained 0.7%.

The S&P 500 has fallen 6.8% from its Sept. 18 record as the Fed contemplates when to raise interest rates. The index is down 4.8% over three days, the most since November 2011.

The International Monetary Fund cut its forecast for global growth last week and said the euro area faces the risk of a recession.

The IMF now expects world growth to register at 3.3% in 2014, down 0.1% from its forecast in July. For 2015, it also slashed its forecast by 0.2% to 3.8%.

The organization, which represents 188 countries, now expects world growth to come in at 3.3% in 2014, down 0.1% from its forecast in July. While in 2015, it expects growth of 3.8%, down 0.2% from earlier expectations.

It comes less than a month after the Organisation for Economic Co-operation and Development (OECD) slashed its expectations for the global economy because of concerns about a stuttering recovery in the U.S. and the continued fragility of the euro zone.

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