|
By Peter Degraaf
Charts in this essay are courtesy Stockcharts.com unless indicated.
 
This chart courtesy www.macrotrends.net
shows the price of gold compared to the US Monetary Base. The current
ratio is at 0.30 and this is the lowest it has ever been! This
makes gold the least expensive (compared to the monetary base), in history!
When this index turned up in early 1970, the gold price rose from around
$200 to $850. When this index turned up in 2001, the gold price rose
from $260 to $1915. Interestingly, this index is once again in the
process of turning up!This time it is turning up from the most 'oversold'
level in history.
This chart courtesy Nick Laird at Goldchartsrus.com shows money supply in
the USA continues to rise exponentially.
Featured is the weekly gold chart.Price is carving out a large bullish
falling wedge.The supporting indicators are positive, including the important
A/D line.An upside breakout at the blue arrow is just 20.00 away!When this
breakout occurs it sets up a target at the green arrow.The rising green
channel in the 'zoom chart' at right shows the upward progress made since
December.
Featured is the gold chart in foreign currencies.Price has been rising
since late 2014. The recent breakout above the 200DMA is confirmed by the
positive supporting indicators (green lines).This trend is setting the
example of what is due to take place in gold as expressed in US dollars.Price
is preparing for an upside breakout at the blue arrow. Volume is building
(green box), and Tuesday's volume was the heaviest in 15 months.A breakout at
the blue arrow will turn the trend bullish for the first time since late
2014, and likely mark the start of a strong rally.
Featured is an example of gold in Canadian dollars.Price shows a steady
rise since December 2014.The moving averages are in positive alignment and
rising, (green oval).
This chart courtesy Nick Laird at Goldchartsrus.com shows withdrawals of
physical gold at the SGE continue to mount. This provides bullish fundamental
support.
This chart is also courtesy Goldchartsrus.com and shows the number of
tonnes of gold withdrawn by jewelers and investors during 2015 at the SGE,
which was the highest ever -almost 2600 tonnes.
This weekly chart compares gold to the S&P 500
index.Price is breaking out in favor of gold, from a bullish falling wedge.A
Friday closing price above the blue arrow will confirm the breakout.This is
bullish for gold as it shows investors bailing out of the stock market (the
current 'dead cat bounce notwithstanding), and seeking safety in gold.The
supporting indicators are positive (green lines rising upward).
Featured is a weekly chart that compares gold to a basket of foreign
stocks.Price has already broken out at the blue arrow.The first target is at
the green arrow.
This chart courtesy Goldchartsrus.com shows the amount of physical gold
that is registered (available for delivery against futures contracts) is at a
very low level.There are now over 500 claims per ounce.When the remaining
gold is claimed, there will be a lot of people who will have to settle for
'paper gold'.
This chart courtesy BMGbullion.com shows an indicator that has turned down
twice since year 2000.Each time it turned down it marked the beginning of a
recession.
This chart courtesy BMGbullion.com shows the performance of gold during
stock market crashes.
This chart is also courtesy BMGbullion.com and it shows the percentage
rise in the price of gold after a major correction.In the event that history
repeats, then a 445% increase from $1,120 sets up a target at $6,000; a 750%
increase from $1,120 sets up a target at $9,500.The average rise would take
gold to $7,700.
The three charts featured above are borrowed from Nick Barisheff at
BMGbullion.com. At his website one can access a 12 minute video featuring
these charts and a few more.
This chart courtesy US FED and Zerohedge.com shows fiat (unbacked) money
is being added to the system at an exponential rate. This sows the
seeds for an exponential rise in the price of gold and silver.
This report has featured the upside potential of gold.We now turn to
silver.Everything that is bullish for gold is at the moment even more bullish
for silver, as this chart suggests.The expectation is for gold and silver to
rise, with silver soon outperforming gold.
Disclaimer:Past performance is no guarantee for future price action.Peter
Degraaf is NOT responsible for your investments decisions.
Peter Degraaf is an investor with well over 50 years of market
experience.He publishes a daily report for his subscribers.For information
please visit www.pdegraaf.com or
E-mail itiswell@cogeco.net
|
