| We saw a strong rally in precious metals last week, what was the main driver of this? Oversold and typical bounce that would see after a short term sell off. Counter trend correction. Correction was somewhat expected and tend to see one towards end of year prior to frequently seeing strong gains over the Xmas period and into the New Year. However speed and scale of the sell off was quite unusual. Counter intuitive as it happened with no significant gold related news or indeed wider economic, financial or market related news that could be attributed to the sell off. There was no corresponding sharp moves in the dollar or stocks markets when gold sell off. So this had led to the more accusations of market manipulation and Wall Street entities using the futures market to artificially suppress gold prices. The "powers that be" do not want a surging gold price and gold challenging record highs given the very risky situation facing the world in the coming few weeks as we gaze down the precipice of a potential Hard Brexit and the possibility of a titanic legal battle for control of the White House. Do you think that we have now formed a base for gold and silver prices to move higher? Impossible to tell in the short term but most probably yes. We have likely bottomed or will soon bottom. We got as low as $1765/oz on gold and just over $22/oz on November 30th (happens to be my birthday) and we have now rallied to $1830 and $23.76. The dollar has continued to come under a lot of pressure lately which has been a contributor to gold's rally - what is going to stop this rout for the US dollar? Good question. The fundamentals for the dollar are poor given the poor economic outlook and the appalling fiscal outlook for the U.S. Not to mention the complete dysfunction of the U.S. politically and the fractious civil war style politics. Bitcoin has traded at a new all time high, why are we seeing a sell off with gold rallying? Up 165% in 2020 alone - from $7,500 to $19,300 (high of 19,914) and is overbought from a host perspectives including technically and technical measures such as the RSI (14 day). What are you going to be watching closely this week? I try to tune out all the short term noise - whether that be the 24 hour news cycle or daily market movements. At same time, I will do a daily check on Brexit developments and indeed the Trump V Biden battle both getting the Biden view from MSM and the Trump view and developments from his Twitter account and alternative media. It is important to keep an eye on both in these Orwellian times. To CONCLUDE, gold and silver buyers need to continue to focus on Value and the value of owning actual ounces in coin or bar formats rather than on short term price volatility. $2,500 to $3,000/oz gold and $50/oz silver is likely in 2021. Keep the faith and if you do not have a high enough allocation to pms then keep acquiring on weakness |
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Maaa-aaa-aaate
2020-12-08 at 13:03 (UTC 2) Link to this comment
Nothing to do with the USD ? If you can't be honest about the cause, how do you expect anyone to believe a thing you say ?
Ruth Murphy
2020-12-08 at 13:31 (UTC 2) Link to this comment
Good to finally be able to hear you Mark! And great, practical advice, as always.
Mark OByrne
2020-12-08 at 17:15 (UTC 2) Link to this comment
Thank you kindly Ruth
Dan Loosmore
2020-12-08 at 15:11 (UTC 2) Link to this comment
Im amazed that people still can't talk about price manipulation when there is massive dumping of paper contracts ahead of the COMEX delivery week, it's not a conspiracy theory, it's conspiracy fact.
John P
2020-12-09 at 14:14 (UTC 2) Link to this comment
How can metals be valued in Fed notes when said notes are worthless, please explain that?
raymond walsh
2020-12-13 at 21:46 (UTC 2) Link to this comment
There's no doubt that Bitcoin is getting a serious amount of equity that should really be moving into Gold and silver. Institutional money is now coming around to the proposition of bitcoin ahead of gold. I struggle to accept that Bitcoin could be seen as a safe haven. I know the people who are involved in bitcoin are very smart guys, i think block chain technology is brilliant but govenrments will never allow it to be legal tender and may potentially outlaw people holding. China are already confiscating bitcoin from its citizens.