Buy: Gold

While I don’t like Gold as much as I like Bitcoin as an asset or a trade, I think there is a buying opportunity at current prices. With governments around the world printing money at unprecedented levels, I think hard assets like Gold will outperform.

In 2008, Gold sold off 30% before rallying 180% over the next few years. As we are seeing today, when people need or want cash, there is no true safe haven asset other than cash. In the past few weeks, Gold is down 13% from the recent high of ~$1700. I think the current level is an excellent buying opportunity, down to about $1390 which is 5% lower. Should price get to that level, I expect it to hold and then move higher. From The current price of $1470, I think there is at least 30% upside to the all time high of $1895 set on September 5th, 2011.

I expect the horizontal green line to act as support for price now that price has broken through. This area has acted as resistance for years, and I expect buyers will step in and support this area should price continue to retrace. The target for this trade is the all time high price about 30% higher from the current price of $1470.

Orders of physical gold are experiencing very high trade volume and according to online precious metal dealer JM Bullion, “Due to extreme order volumes, please expect shipping delays of 15+ business days.“

Invalidation for this trade is if price begins closing below $1390 on a weekly basis.

Leave a comment