Are we witnessing the long awaited Gold breakout?

With spot gold hitting the 1051 dollar oz price at 0238 GMT today, does this mark the start of a breakout and a sustained upward trend?

ON 6th Oct he daily telegraph reported;

www.telegraph.co.uk...

that finance ministers and central bankers had been lobbying certain countries to price future oil using a basket of currencies (including gold) in favour of the US Dollar.

This seems to have put the "official stamp of approval" on gold, resulting in gains in 3 consecutive sessions and breaking into new and unchartered territory.

Using technical analysis, Barclays Capital predicted that the gold price could rise as high as $1,500/oz. The bank is targeting $1,050/oz initially, followed by $1,120/oz. It advises holding long positions in the precious metal.

The gold price is still significantly below its inflation-adjusted high. The price hit $850/oz in January 1980, which represents a price today of about $2,300/oz when adjusted for inflation.

www.telegraph.co.uk...

CNBC report suggests gold could hit USD 2000

www.cnbc.com...


PEACE,
RK

reply to post by Rigel Kent


I don't understand the correlation between the price of gold and the potential of using an amalgamation of foreign currency for oil commodity trading rather than the U.S. dollar. Can you explain more?

Really good news for South Africa. Our basic economy and expectations of employment are so dependent on gold prices.

What we will see is that gold production (by Russia, South Africa and others) will be boosted ... this will probably mean that gold will eventually stabilise or reduce slightly as the market adjusts.

I am not sure about a spike in Gold prices (relative to the US Dollar's net worth actually) .. the rise in Gold prices along with a sustained Equities Market imo is spelling out to those of us who have waited: Inflation.

It could be time that the monetary effects of the Federal Reserve and the Federal Government will be felt amongst the broader economy.. if Gold rises, with Commodities, and the Equities, it signals the decline of the US Dollar as the market has been inundated with Dollars... Inflation, coupled with the Deflating number of Dollars at the consumer level could spell disaster.

We will have to wait and see, of course..

Yes, it’s hyperinflation and a rapidly falling dollar that we are witnessing, gold is simply a comparison point. 100 years ago, you could buy a decent house for 80oz of gold. The same is true today.

Gold is not rising, the dollar is falling.

reply to post by resistor


I do not think we are witnessing hyperinflation just yet. when we do, we will all know about it, there will be no doubt as it will smack us in the face and hurt us tremendously.

PEACE,
RK

i heard different valuations:

... The gold price is still significantly below its inflation-adjusted high.
The price hit $850/oz in January 1980, which represents a price today of about $2,300/oz when adjusted for inflation. ...

I hear/ read that '80 gold would presently be $1,850.oo
and that's what price i will be using as my baseline for making more buys with my ROTH-IRA account in gold shares.

but, for my money, your $2300.oo level only tells me to make only small $50. increments after the $1,850.oo level is attained!

thanks for the info

Not quite time yet for the big parabolic for gold and silver.


Both metals will continue to go up for the time being, with gold going to the $1,200/oz to $1,250/oz range before peaking, then dropping, due to profit-taking, with the price going back down to the high $800s, like $875 at the bottom.


The peak for Gold should be by the end of Oct to mid-Nov; then it should drop down to the trough through the first two months of next year, then it should start up on the biggest bull run in the history of the metal.


Silver should follow a similar trajectory, going to a peak of close to $20/oz, before dropping quickly down to a bottom of around $12.50 to $13.00/oz, then it should also go on the biggest parabolic run in the history of silver, blasting through the $20s like nothing and going through the $30s like nothing, too.

You all know.... when the consensus of everyone is that Gold is going higher...it's time to get out.

well in this case i do not think gold is too speculative or over priced...

i'm holding on and modestly increasing my holdings , because to my thinking the Gold producer/mining stocks have a lot of rise in value to go.

Is it common knowledge that gold production is down, to anyone other than we Gold-Bugs?
It must follow that junior miners will ramp up production, and/or be bought up by the major producers in the short term--- and that can only mean that gold stocks & securities have a 30-50% increase that will be realized by the market.

Physical Gold can stay in the $1050 - $1150. range for the next 2 years, and in the meanwhile the mining stocks will appreciate to catch-up to the markets at the new gold baseline price. i really do not see the cost of
getting the gold increasing very much at all, (not like the $140 bbl price of energy to keep the mines working back in the day)


another factor to consider, is all those gold related ETFs which have a very tiny percentage of the physical gold they claim they have - will be revealed and a panic mode will ensue


another factor is that the soon-to-be basket of currencies Plus Gold for oil exchanges will come into force...with the Gulf States Golden Dinar forming the gold requirement on that basket of currency -> oil bourse
(the Dubai banks which are now in the pits because of the USD demise... They will fare handsomly at the debut of the Gold Dinar in 2010
as originally planned a year or so ago (the Gold currency undertaken with the acceptance/knowledge of the USA)

gotta get ahold of a few gold dinars when issued, they will be affordable as they will only have a few grams per coin...unlike the Loony or Kugerand
which are too expensive to have


have a nice day

reply to post by Rigel Kent


Perhaps it's not to the 'hyper' point just yet, but it is true that inflation is being disguised, particularly at the supermarket where packages of food are getting smaller as the prices rise slightly or remain static.