Gold

[elZorro]

6 months going sideways as long as it stays above the 1525-1530 mark (January low) has got to be better than the previous 6 months.

Loss since the August 2011 high. 15%. Not so bad compared to many stocks, especially Gold stocks. Got to be a bargain somewhere amongst that lot. Surely?

I have to admit GEL and OGC are only a HOLD at the moment, IMHO. But a rising gold price will bring all goldies along with it, and I wouldn't mind another ramp like 2009-2010.

[Skol]

Looks like another down day for the XGD.

Dow, S&P up, but HUI down 1.03%, GDX down 1.04%, XAU down 1.04% etc. etc.

[JBmurc]

“We’re in a very unfortunate position to be here,” Richard Duncan, author of The New Depression, warned on CNBC’s “Squawk Box Europe” Monday.

“When we broke the link between money and Gold, this removed all constraints on credit creation. This Explosion Of Credit created the world we live in, but it now seems that credit cannot expand any further because the private sector is incapable of repaying the debt it has already, and if credit begins to contract, there’s a very real danger that we will collapse into a new Great Depression,” he argued.



http://video.cnbc.com/gallery/?video=3000103083

[Hoop]

Here is a chart which suggests that the POG has tuned up. Waiting for it to get above $1600 reminds me of the push to get above $1,000 a couple of years ago.

Agree with Strat....based on that chart it is a big call..Below is a longer term chart which shows the part of the story that Sangers Chart omitted to tell you.
The Chart below is based on US$ and is a different species to Strats A$ chart


Note on the Chart, that the Gold price is running out of wiggle room within the Descending Triangle formation.

In Statistical analysis the breakout is downwards 64% of the time and is at it's strongest breakout momentum around the 80-85%area towards the triangle's apex which is about now.
Trade on the breakout ...The breakout is especially reliable if it is upwards.

[JBmurc]

Kitco News) - The amount of new gold discovered has not kept up with the current pace of mine output, as the easy-to-reach gold deposits are being depleted, said a mining consultancy group on Tuesday.
From 1997-2011, there have been 99 discoveries of gold deposits containing at least 2 million ounces of the metal, totaling 743 million ounces of gold in reserves, resources and past production as of the end of 2011, said the Metals Economics Group in a research report.
“Assuming a 75% resource-conversion rate and a 90% recovery rate during production, these 99 discoveries could potentially replace only 56% of the estimated gold mined during the same period, if they are economical to mine,” they said in their report,

“Strategies for Gold Reserves Replacement: The Costs of Finding and Acquiring Gold.”
The challenge for producers is “not that there is no gold left, but that all the ‘easy’ gold has been found,” they said.

The total amount of gold in reserves and resources at development-stage projects on a global scale roughly matches current mine production. “However, with increasing risk of political, regulatory, and tax instability in many resource-rich nations, declining grades, rising costs, and dramatically longer development times, the amount of gold available for production in the near term is likely far less than has been found,” they said.

[STRAT]

Agree with Strat....based on that chart it is a big call..Below is a longer term chart which shows the part of the story that Sangers Chart omitted to tell you.
The Chart below is based on US$ and is a different species to Strats A$ chart


Note on the Chart, that the Gold price is running out of wiggle room within the Descending Triangle formation.

In Statistical analysis the breakout is downwards 64% of the time and is at it's strongest breakout momentum around the 80-85%area towards the triangle's apex which is about now.
Trade on the breakout ...The breakout is especially reliable if it is upwards.

Thanks for that chart Hoop.

As to trading on a breakout. Not sure Id want to be buying Aussie Gold stocks based on a breakout in US dollars. US dollars being what they are.

[elZorro]

“We’re in a very unfortunate position to be here,” Richard Duncan, author of The New Depression, warned on CNBC’s “Squawk Box Europe” Monday.

“When we broke the link between money and Gold, this removed all constraints on credit creation. This Explosion Of Credit created the world we live in, but it now seems that credit cannot expand any further because the private sector is incapable of repaying the debt it has already, and if credit begins to contract, there’s a very real danger that we will collapse into a new Great Depression,” he argued.

http://video.cnbc.com/gallery/?video=3000103083

The private sector is not generally doing well enough to service debt. In the race to the bottom (sharper prices, outsourcing) there is slender profit on average (but not for Apple, who have marked their products up). Of course if we all had access to cheap energy, many goods and services would be cheaper to provide, and the public would have more spare cash for discretionary purchases. Businesses would also be more interested in energy intensive manufacturing plants and processes, anywhere in the world, close to markets.

I still think that major developments in the energy field promising cheaper and sustainable energy worldwide might be the only thing that will pull the world out of this credit mess. I can't see anything dramatic popping up at the moment, and energy system changes take years.

It's frustrating when we're surrounded by energy: e=mc2, where c is a very big number.

Great gold chart thanks Hoop, I would like to be part of the 36% hope that US$gold breaks upward.

[Skol]

My bet is that gold will break out downwards. At the tip of the triangle it will be 1 year since gold peaked with a classic double top. Investor psychology might be to get out.

[CAM]

I am on the up side... but hey who really knows...

poor Spanish bond auction overnight reignited fears about the European debt crisis and weakened the euro.
US existing home sales fell unexpectedly,
the Philadelphia Federal Reserve survey of manufacturing activity fell for the third month running,
US consumer confidence fell,
jobless claims rose

However, the Dow rose 0.3% as, perversely, more signs of bad economic news encouraged stock investors to believe the US Federal Reserve will have enough evidence to go ahead with a third round of quantitative easing (QE III) as early as August 1

the oil price rose sharply overnight as tensions mounted in the Middle East. Governments are now planning for the collapse of the regime in Syria and Israel blamed Iran and Hezbollah for a deadly attack in Bulgaria on Israeli tourists

[elZorro]

I am on the up side... but hey who really knows...

poor Spanish bond auction overnight reignited fears about the European debt crisis and weakened the euro.
US existing home sales fell unexpectedly,
the Philadelphia Federal Reserve survey of manufacturing activity fell for the third month running,
US consumer confidence fell,
jobless claims rose

However, the Dow rose 0.3% as, perversely, more signs of bad economic news encouraged stock investors to believe the US Federal Reserve will have enough evidence to go ahead with a third round of quantitative easing (QE III) as early as August 1

the oil price rose sharply overnight as tensions mounted in the Middle East. Governments are now planning for the collapse of the regime in Syria and Israel blamed Iran and Hezbollah for a deadly attack in Bulgaria on Israeli tourists

Thanks for the news review CAM. Doesn't look too good all put together.

Here's one blog about 1st August QE3. http://www.calculatedriskblog.com/20...ture-date.html

And another for September. Both before the US elections.
http://www.businessinsider.com/bofa-...er-fomc-2012-7

Bets for QE3 are bracketing August/Sept, before the elections, or into early 2013 if things go feral in Europe.