Frank Guistra has the more (only) solid approach to managing wealth protection | 23 April 2021
Gold Price Forecast relative to
Long Term Monthly (LT-M) - Medium Term Weekly (MT-W) - Short Term Daily (ST-D) - and Hourly (not shown) data.
(Previous week in brackets)
|1776 (1776) (unch)
|Au Trend||↓ (↓)||↑ (↑)||↓ (↑)|
|Au % Risk
|49 (50)||35 (28)||84 (83)|
Portfolio allocation 30% (35%)
Physical Gold: Nature's currency
23 April close: The Bitcoin versus Gold debate between Michael Saylor (100% Bitcoin) and Frank Guistra (20% Gold) was interesting because of 2 interesting individuals with strong views bringing short term (Saylor) and long term (Guistra) knowledge into a highly volatile arena of narratives. The entire, well prepared, Stansberry debate was comparing apples and oranges of course but our clear winner is Guistra for one reason only: You simpy MUST NOT put all your eggs in a single basket. The full 2 hour debate can be seen on Youtube here > https://youtu.be/coHC_9ApBdg.
With that said, Gold performed fairly strong until it fell a fourth Friday in a row closing without much change. This gold asset looks fairly solid still with weekly in an uptrend and monthly just ready to turn back up into an unfinished bull market. Daily has not yet produced a sell signal even though risk weight is high but not at all critical at 84%. We exercise patience and no change.
16 April close: On the question 'Is gold ready to explode?', the answer of course is 'YES'. Especially as all financial markets are building a 'sky is the limit' atmosphere attracting millions of first time and often small investors towards the many low commission online brokerages and crypto exchanges. Our Gold and PM portfolio remains unchanged. And even though the portfolio has shed another 5% last week (from 35% to 30%) due to further crypto advances in the overall portfolio, Gold and Platinum and Silver are still our key pillars for full protection. No financial asset ever finds real equilibrium during a long period of time but they do always return to that long term price average if the deviation extends too far for too long and then usually also goes through that longer term price average. Where crypto and to a smaller extend equities have rapidly outpaced precious metals by a large factor during the past 12 months the divergence between the hotter assets and precious metals will at some point be rectified. We don't know when or how, but the most likely scenario is an implosion of all of the hyped assets running parallel to a strong increase in the real value of precious metals. A minimum of 20% invested in precious metals will then prove to become a near complete safety net and sure to protecting 80% or at least enough of your accumulated wealth. The current asset bubble however could easily extend for another 6 to 9 months or even longer. The longer the bubble lasts the more apparent will be consumer price inflation which is where gold always protects purchasing power. No Change.
Note: Stansberry Research' highly popular Youtube channel is moderating a potentially very interesting 'Bitcoin or Gold' debate between Michael Saylor (for Bitcoin) and Frank Guistra (for Gold), two very respected entrepreneurs. Whatever the outcome, which will be watched and broadly hashtagged by many major players in the financial industry, our above protection strategy prevails. Going all in on one single asset is a fools game of course. The Saylor/Guistra battle will air on Tuesday 21 April.
23 April comment
There is typically very little change in the very long term quarterly risk chart if closing price is more or less the same. The picture tells we have many more quarters to see a positive development for Gold versus USDollar.
Comment 16-April: Our reading of the quarterly long term Gold/USD chart is actually quite bullish. New high peaks and higher risk lows as the price advances. This makes a more mixed reading of risk weight in the Daily to Monthly charts look more positive too. If you consider selling gold for a more powerful looking asset in crypto or equities, DON'T. Unless you already own well over 20% of your portfolio in precious metals. 20% should be the minimum today. What that also means is that if highly profitable non metal assets exceed 80% of total, move a percentage of profits into PM again.
Gold/Euro live price
23 April 2021: The picture of Gold vs Euro feels a little heavier this week than Gold/USD which has to do with a weaker dollar across the board. This may pause the Gold advance versus Euro a bit longer perhaps, but foolish to remove Gold from the portfolio equation. Full Hold.
16 April 2021: Gold/Euro looks slightly more bullish even but the risk picture is very similar to Gold/USD. Monthly risk is still in a down trend but could easily return to its primary uptrend within a few weeks. As we use a 14 period average to calculate a general trend in all time frames, May could create that turn already as then the downmonth of March 2020 will disappear from the calculation. 'Hold'.
Gold/British Pound live price
23 April 2021: GBP still looks the potentially weaker currency versus gold even though it has kept a fairly strong position in the overall currency space. Where Gold clearly is one of the heavily managed currencies that is now dancing round the floor, we believe it is just a matter of time before Gold spikes hard again versus GBP. Monthly is down still but doesn't feel like that's where it wants to go. It may still do temporarily, however Gold must be a stronger Hold than Bitcoin.
16 April 2021: GBP strength of late has pushed long term risk into deeper low risk ranges in both Medium and Long term time scales. Holding onto Gold for GBP tax based investors is a must as well.