The-Price-Of-Gold-Is-Appearing-As-If-It-Is-Set-Up-88 by Gail1945625


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									The price of gold is appearing as if it is set up for
 another bull run. Is this from any sophisticated
  technical chart analysis? No, it is merely from
 examining the chart of the gold price (using the
GLD ETF as a proxy) and observing the similarity
 of patterns that seems to be matching the gold
 price's rise from the consolidations of last
summer. Here and now, we have just witnessed
gold's price gyrate up and down ... gold just
       feels like it is headed for new highs.

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 Note that the price is just now making a fourth attempt in as many
months to penetrate the new high price set in as many months Last
summer saw a similar situation, where the price made about five attempts
before finally setting a new high on or about September 1 This
consolidation also lasted about four months Then, when the price set a
new high at September's start, the "Gold Bull Run" was off and
running for the fall
  Are there any other factors that may help the investor allay his fears of a
pending crash in the price of gold, rather than starting a new bull run?
Here are three significant factors underpinning gold's price: 1
Inflation of Paper Currencies The markets interpret the FOMC's
previous pronouncements as inflationary for paper currencies, and this
effect is expected to continue until there are some indications of inflation
being reined in This currency inflation is a fundamental driver for the
precious metals 2
 Rise of the World's Middle Class Supporting Gold Prices There is
a rising middle class as the world's emerging markets continue to
grow and gain parity with the world's developed markets The size
of the world's middle class growth is largest in the Asian economies
and of a scale that the world has never before seen Asians have a
particular affinity for the precious metals due to their history and culture of
precious metals being a store of wealth This buying by emerging middle
classes provides a strong base of support for precious metals prices
 3 Peak Gold Is Coming Due to Higher Costs and Lower Grades Barrick
Gold's (ABX) chief executive Aaron Regent already declared a state
of "peak gold" in 2009 The thesis is that gold mining is difficult, and the
challenges of increasing costs, lower gold grades, and difficult operating
environments all coalesce to decrease gold production supply This "peak
gold" dynamic is ensuring that the new production supply of precious
metals will be constrained in the future
  Summary Therefore, the chart above merely reflects the market's
reaction to the fundamental drivers affecting gold prices Currency
inflation is the prime driver Buying from Asia supports the price during
corrections Future gold supply is constrained by peak gold
 With these factors affecting gold prices, is it any wonder that a significant
rise is in store? Disclosure: The author is long junior miners, including
precious metals miners Gold Heading for Another Bull Run article by
Marco G GoldBullionPro
com is all about investment in precious metals such as gold, silver,
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