Gold

[corran]

so Trump wins and gold gets slammed. It's a strange world. Stocks like Goldman Sachs which I thought would have been freaking out over a Trump presidency are flying (GS is up around 14% since the election) and gold is getting slammed.

So the question is where does it go from here? Support around these levels and then back up with a vengeance? Settle on a lower support level around $1150 - 1200 and stay there for a while? Or crash on down towards $800?

I've got no clue. I think the fundamentals would suggest a higher gold price but how much stock to place on fundamentals in these markets?

[Joshuatree]

So many caught out here.A snippet from Sprott Donald Trump’s election, combined with Republican majorities in both the House and Senate, clearly marks a new direction for U.S. government policy. Given that U.S. government policy and actions are a dominant factor in the world economy, we think it is important to take stock as to how the policies of Trump’s presidency might affect markets and, therefore, our investments and speculations. Below is a snapshot of how certain commodities and major markets have moved this week: Dow Jones up 4.5%, copper up 10%, Nickel up 13%, Oil about even, Gold down 5.5%, Silver down 5%, and the 10-year Treasury yield up 20% (!). Many of these weekly percentage changes are significantly larger than average weekly variations, and we think some could be meaningful indications of what might occur as Trump’s policies take effect, while others might be short-term head fakes and non-indicative of longer term trends. We will take the weekend to collate our own thoughts in combination with those of the broader Sprott group, and disseminate our ideas to you over the coming weeks. In the meantime, here is a snippet of short-term analysis on the action in the gold market: If you’ve been following the gold market over the past few days, you’ll have noticed golds negative reaction to Donald Trump winning the U.S. presidential election (contrary to what the vast majority of analysts expected). Today the gold price has punched below the technical support level of $1,250 which initiated a chain reaction of stop losses, further exacerbating the decline. Gold closed the week at $1,225. The charts now suggest we are likely to see a test of $1,220 to $1,200 (see the chart below), a very key support level where we have seen significant buying in the past. $1,200 is a level that warrants close attention:

As a result of the selloff in gold, mining stocks have suffered in a similar fashion and a key support level at $22 on the GDX was broken to the downside. There is strong multi-level support between the here and $19 to $20, so we are watching to see signs of accumulation/buying support here to confirm a hunch that $1,200 in gold may provide the low on this corrective leg we have been experiencing since mid-June.

After a week like the one we’ve just experienced, it’s also pertinent to step back and look at the bigger picture, as shown below in the weekly chart. It’s important to keep in mind that if $1,200 is hit on this down leg, gold would still be up 15% from the yearly lows of $1,050 we experienced just 10 short months ago. Furthermore, history tells us that in the gold market it is quite common to retrace 50% of the gains of the first leg of a new bull market. Interestingly, $1,200 represents an almost perfect 50% retrace from the yearly high of $1,370.

The gold market is starting to look extremely oversold and for those with a more aggressive investment philosophy and a strong conviction that gold is going higher in the long term, the next few weeks may offer up a good entry point. For those with a more conservative approach, waiting for confirmation of a low in this down leg is a more suitable approach. Beyond gold, there have been some strong moves over the past week in base metals, with copper and nickel both experience double digit percentage gains. Keep a lookout next week as I hope to release my thoughts on the sector

[corran]

Thanks Joshuatree !!

[digger]

Since the election and the following anti Trump riots I have the feeling that gold is being pushed down to nip in the bud any beginnings of economic chaos. Remember before the election we were told often enough that Trump would bring chaos and economic collapse and that gold would rapidly climb because of these fears. If the fed now brings down gold it will lay these fears somewhat.
Thoughts.

[Valuegrowth]

We should see more demand for stocks over gold in the coming months in global markets especially in 2017.Now some think copper is new gold. There could be short term support for copper.

[corran]

We should see more demand for stocks over gold in the coming months in global markets especially in 2017.Now some think copper is new gold. There could be short term support for copper.

Here's my predictions (which may very likely be wildly off the mark but it's fun having a guess eh??!!)

- The rise in copper is actually a predictor of coming inflation. Gold and silver should also be rising but are being suppressed
- Gold is being suppressed to (1) give the illusion of calm (2) enable the big boys to get their hands on physical cheap
- The sharemarket rise will fizzle out shortly (I think within weeks) and come back down with a massive correction
- Next 6 months will bring huge volatility in all assets. I think share markets will lose a lot of value. There will be massive currency fluctuations and emerging markets will be worst hurt.
- To counter this central bank's will pump a huge amount of money into the system which may cause sharemarkets to rise but will more likely cause inflation and gold to shoot up.

[airedale]

POG breaking up through $1300 overnight before settling back just under. Could be the start of the next leg up.

I should delete this post. It is not my best guess or prediction🤐

[Aaron]

I wonder if India's move to withdraw large currency notes will help the demand for gold as an alternative to put under the mattress if you lose faith in the banking system?

[JBmurc]

I wonder if India's move to withdraw large currency notes will help the demand for gold as an alternative to put under the mattress if you lose faith in the banking system?

You would think it would be a bullish outcome for Gold

[Aaron]

You would think it would be a bullish outcome for Gold

I can only hope, when Stanley Druckenmiller said he has sold out of gold because the reasons for buying it changed after Trump was elected is concerning.

Maybe I should cut my losses on gold miners now and come out reasonably even. Another investment not making me any wealthier.