Gold is acting miserably. So I want to give you an update this morning.
But let me first make it perfectly clear that the AI models still show the potential for a soon-to-arrive rally, one that could take gold back up to at least $1,300.
It’s important we keep that in mind, as gold is now more oversold than I have ever seen it in my 38 years trading it, even back at its year 2000 low at $255 just before it started an 11-year run up to $1,925 in September 2011.
That does not mean we’re on the cusp yet of another 11-year run and 655% gain. But it does mean we are edging closer and closer to it.
The same can be said for silver and other precious metals. Miners as well.
For right now, I’d like you to see a technical chart of gold I put together early this morning for you:
As you can see, the overall pressure and bear market since September 2011 remains intact.
However, very strong technical support is now building right at the early January 2017 cycle period (per my AI charts) and just below $1,000.
That is great news. Another convergence of time and price, and coming on the heels of what would prove to be a five-year bear market from gold’s 2012 closing high price of $1,796.10.
Yes, it’s been frustrating and tedious. But the bottom is in sight. You can also tell the bottom is in sight by how hated gold is now. India has effectively outlawed it and is confiscating it from investors.
France has also effectively chased gold out of the country when it sent gold dealers packing over the past three years.
Sharia finance law has embraced gold, but that’s not going to equate to enough demand by itself to create a new bull market.
Western socialist government leaders want gold dead and for now, they are prevailing.
President-elect Trump is a huge fan of gold, but more for personal reasons than as a monetary instrument or asset class. He loves his 22k gold sinks, toilets, wallpaper and more – everything gold – and adorns his Trump Plaza home as well as the corporate Trump plane and helicopter with gold objects.
He has made recent comments about re-introducing a gold standard into the U.S. monetary system – but it will never happen. And it shouldn’t.
In reality, a gold standard has never prevented a financial crisis and instead has each and every time it’s been implemented, created a set of golden handcuffs that were a large factor causing monetary systems throughout history to collapse from within.
The irony is that the end of the current gold bear market that is taking shape now will backfire on Western leaders and economists and instead, create a massive new bull market built on smaller investor demand.
Those investors – like you and I – ultimately carry more buying power than any institution on the planet.
So much so that I believe the months and years ahead will create a new, black market – underground – for gold and other precious metals.
I see it already happening and am receiving source reports on it from India and other countries that are trying so hard to eliminate gold.
So be patient and get ready. A new, and likely underground market for gold is already starting to take shape …
The unintended consequence of leaders who have gone ape racking up the world’s worst sovereign debts and abusing investors like never before.
Hold your only two positions at this time, which are light. The Direxion Daily 20 Year Plus Treasury Bull 3X Shares (TMF) with a good-till-cancelled protective sell stop at $14.70 …
And the light long position in ProShares Ultra Gold (UGL) with a good-till-cancelled protective sell stop at $31.39.
Lastly, be sure to see my December Real Wealth Report publishing Friday.
It’s chock full of information including key 2017 annual support and resistance indications and five of my very important AI neural net forecast charts for the five most important markets for the first quarter of the new year.
Best wishes, as always …
Larry
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