Gold Charting the Un-charted

Gold is heading into uncharted territory according to some experts. Yet, others believe the charts show gold is a predictable asset class with the charts as a map. We fall more in to the latter category. This blog on occasion delves into the technical side of metals. Today we will look into three charts to see what they might yield.

First is the one year chart:  With a low of $1,309 and a high of $1,900.30 a median trend line ends up just below the $1,600 range. So what does that mean? With gold’s current spot price of $1,640 there is the potential for it to settle into a trading pattern not much further below $1,600. This is also supported by the next chart from the previous five years.

Once again we see support at the median line of just below the $1,600 mark. Giving an indication of gold settling into a pattern of trading near this price point. Does this mean gold will be a straight line? Absolutely not, there will be dips & surges of the price just as the charts show but the indication is gold leveling into a position nearing $1,600. The final chart is really where the surges & retractions are broken down.

The 10-year chart had 3 lines that give an indication of 3 separate scenarios. Base line in Black keeps to the lowest dips over the previous decade. It trends out to around the $950 mark for gold. We believe this is the worst case scenario.  It also shows about the same 50% retraction that happened in the early 80’s in the market. The Blue line runs to the top position & is potentially unsustainable. (This line sustains the $5,000 an ounce predictions) The Gold line is where we want to direct your real attention. It runs the middle of the two previous lines showing a reasonable outcome. It is the lowest median line of the three charts but still sustains over the $1,400 mark per ounce.

This final chart runs the gamut of where gold may go given its previous decade bull run. So what does all this mean? That gold has the potential to go higher or lower over the near & long term. What is important that you know the potential risk of gain or loss in your investing. Armed with this information one can go with confidence building a personal Tangible Asset Portfolio as financial insurance for you total net worth.


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