Gold/USD risk prediction | 03 December 2021
Gold Price Forecast relative to
Long Term Quarterly, Monthly - Medium Term Weekly - Short Term Daily - and Hourly (not shown) risk weight data.
(Previous update in brackets)
|Au Trend||↑ (↑)||↓ (↓)||↑ (↓)|
|Au % Risk
|32 (30)||47 (60)||10 (12)|
Portfolio allocation 40% (40%)
Physical Gold: Nature's currency
03 December close: November closed and the December opening is just pushing the long term risk weight trend into positive territory. Simple chart support now resides at around 1705 which is the resistance line between August 2020 and Jan 2021 which was negotiated a few times this year and now holding. This is important and positive even though the overall performance of Gold and other precious metals have been disappointing, especially for traders. Our long term hold remains unchanged as our allocation sits just below Super cycle support (€1100) inclusive of physical holding expenses which visualised by the uptrending support line meeting the start of the super cycle uptrend in 2004 and through the quarterly low closings of 2015 and 2018. Resistance is at $2300 (€2035) on a linear scale chart. In rapidly increasing (hyper)inflationary economic conditions this resistance will surely be broken as it always did in history.
26 November: Even though 'important world financial news' caught precious metals traders strangled, The Powell renomination isn't going to change anything. The precious metals space including gold sold off fairly sharply, also triggered by a stronger dollar in the process, but with gold hanging on better than Silver and Platinum. Even though this is another sad moment for Gold bugs these type of sell offs make the market look even stronger in the medium and longer term. Technically at least. Daily risk weight dropped from high to low risk whilst Weekly risk weightdid move into the strong downtrend. Above $1675/oz Gold is still withing the higher 15 months consolidation range which is the key range to watch and to remain patient. The entire financial space is a Casino until it isn't anymore and reality kicks in. As long as we do not witness any major technical uptrend ending scenario, we must stay vigilent on the actual reasons behind these types of sell offs. Nothing has changed and if anything nothing will change in direction of even more monetary stimulus. It means that risk in larger traditional asset classes like bonds and stocks remains fairly extreme but could continue as it has done for the past 3 years with a few shockwaves in the process. No Change to our, still profitable, Gold allocation.
19 November: Precious metals lead by Gold held remarkably well as the USD currency continued to strengthen during the week. The Friday sell off we've seen so many times the past several months appears to have weakened whilst the weekly range was fairly narrow. There isn't a strong indication as our tools show mixed risk whilst the price consolidates horizontally in range trading above the september 1834 high. Gold remains a strong hold, especially now that the crypto narrative has strengthened with calls for 2X, 5X and even 20x. This triggers our contrarian feeling as crypto largely remains a speculator-type dominant market.