Back in May last year, I wrote:
“Gold would drop towards $1,000 in 2015, before taking off to about $12,000 by 2025.”
I remembered vaguely that I wrote this article, and with Gold now at $1,200 per ounce, I thought it was time to provide you an update.
Here is the Gold Chart:
Geez, that looks similar, doesn’t it?
Well, Gold is extremely oversold right now, and in the chart below, we can see that Volume spiked dramatically today, which sounds a lot like capitulation…
If the original pattern from the 70′s would hold, here is what it will look like:
First we get a rebound, back towards $1,400, before turning down, and maybe set a slightly lower low before forming a base around $1,150-$1,200. Then comes the final capitulation in late 2015, which will send Gold towards $1,000.
Remember Martin Armstrong’s KEY TURNING POINT (2015.75?), well that is September 2015.
Martin says that Gold will likely go much higher, probably towards $5,000+ (and I also remember him quoting $12,000 once?), but not before 2015.75.
Hmm, sounds familiar.
Martin has been damn right about Gold.
I had a negative view on Gold when it was around $1,900 and especially on Silver when it was at $49 (please see http://profitimes.com/free-articles/silver-20...-look-familiar/ for reference).
I am so happy that I didn’t listen to all the people that were trashing me saying I was not looking at fundamentals etc, and sold my Gold stocks in April 2011. The HUI index was trading around 600 back then, it is trading at 200 right now. That’s a 66% decline!
And what about the fundamentals? Well, they are still the same (and got even stronger), but yet, Gold is down almost 40%!
My HUI:Gold chart has also followed the pattern, although the time frame was slightly different, as we first got a retest of the breakdown level before heading south…
If Gold pummels along until 2015, and if the stock market would get a decent correction, I would expect the HUI to keep underperforming Gold for the time being, which MIGHT send the HUI:GOLD ratio to the lower trend channel line.
However, if Gold runs up towards $1,400 in the near future, I would expect the Gold stocks to follow in some way, as they are extremely bearish right now, and are due for a STRONG rebound. But let’s first set a bottom now…
