Gold: How High In 2020?

Authored by Mike Shedlock via MishTalk,

Gold broke out of a six year consolidation. Things look up in 2020.

Gold Monthly Chart 2004-Present

Gold Monthly Chart 2010-Present

Smart Money Shorts

I ignore short-term COT “smart money” warnings although I would prefer there to be fewer bulls.

For discussion of “smart money“, please see Investigating Alleged Smart Money Positions in Gold.

Pater Tenebrarum at the Acting Man blog pinged me with this idea: The only caveat remains the large net speculative long position, but at the moment this strikes me almost as a “bear hook” that is keeping people on the sidelines waiting for the “inevitable” pullback while the train is leaving the station.

With the 6-year consolidation over, there is every reason fundamentally and technically for gold to continue up.

So, be my guest if you want to time gold to COT positions.

Technically Speaking

Technically, there is short-term monthly resistance between here and $1566. Perhaps there’s a pullback now, but with technical and fundamentals otherwise aligned why bet on it?

The next technical resistance area is the $1700 to $1800 area so any move above $1566 is likely to be a fast, strong one, perhaps with a retest of the $1566 area from above that.

Gold Fundamentals

Gold fundamentals are in excellent shape as I noted in How Does Gold React to Interest Rate Policy?

Much of the alleged “fundamentals” are noise, not fundamental price factors.

Not Fundamentally Important

  • Mine supply
  • Central Bank Buying
  • ETF analysis
  • The ever popular jewelry buying in India discussion

Aso, gold does not follow the dollar except superficially and in short-term time frames.

Gold vs the Dollar

Many people believe gold reacts primarily to changes in the US dollar.

Last week, I rebutted than notion in Gold’s vs the US Dollar: Correlation Is Not What Most Think.

True Supply of Gold and Reservation Demand

It is important to note that nearly every ounce of gold ever mined is still in existence. A small fraction of that mined gold has been lost, and other small fractions sit in priceless statues in museums etc., and is thus not available for sale.

Otherwise, someone has to hold every ounce of gold ever mined, 100% of the time. That is the true supply. Jewelry buying and mine output are insignificant in comparison. We are not about to run out of gold as some gold shills suggest.

Mises refers to the desire to hold gold as “Reservation Demand“, that is the desire of people to hold their gold coins, bullion, bars, and jewelry rather than trading it for something else.

If we strike out jewelry buying, central bank buying, the dollar, and mine supply, what then determines “Reservation Demand” to own gold vs some other asset?

Faith in Central Banks

Talk of normalization was nonsense, as were various “Dot Plots” that suggested the Fed was on a major hiking cycle.

For an amusing chart of where the Fed projected interest rates would be in 2020, please see Dot Plot Fantasyland Projections.

The market did not believe the Fed, neither did I, and neither did gold.

Once again we are back to my central gold theme question.

Is everything under control or not?

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15 Comments
gman
gman
January 2, 2020 5:19 pm

“How High In 2020?”

however high china/russia say.

the experienced
the experienced
January 2, 2020 6:01 pm

It’s not the gold price going up. It’s the Dollar being devalued.

Solutions Are Obvious
Solutions Are Obvious
January 2, 2020 6:04 pm

Since the Fed is printing galore, sooner or later the dollar sinks; common sense.

Therefore gold in dollar terms goes up inversely. Just watch the dollar in relation to other currencies and particularly gold to see how bad off the dollar becomes.

gman
gman
  Solutions Are Obvious
January 2, 2020 6:58 pm

observe supply and demand. observe how there is no demand whatsoever for gold as money. yet.

mark
mark
  gman
January 2, 2020 9:08 pm

HISTORY OF GOLD AS MONEY

History Of Gold As Money

“What we call money today is really just paper; which we can use to buy real money – gold. If we’re smart.”

DinCO
DinCO
  mark
January 2, 2020 9:47 pm

For quite a while, Mike Maloney (among many others) has been careful to distinguish between money and currency (currency being the fiat currencies). For those interested and not aware, http://www.marketsanity.com has some good interviews. Their pulldown of “Investment Gurus” is a good list. And, of course, there is always kitco.com – yes, they are in the business of dealing in precious metals, but that doesn’t mean they are wrong. Many others as well – Alisdair MacLeod from goldmoney.com has good interviews and interviews – https://marketsanity.com/category/investment-gurus/others/alasdair-macleod/ Just my two cents worth.

DinCO
DinCO
  gman
January 2, 2020 9:38 pm

Not much demand for gold/silver here in the USA – it gets “talked down” here, so people haven’t yet realized that gold/silver is money. Unlike Russia, China and India. So, what is the end game?

mark
mark
  DinCO
January 2, 2020 10:16 pm

“So, what is the end game?”

The short answer is your total and complete slavery, if you are left alive.

Here is as complete of the answer to your complex question I have found to date. Its a wild read/ride!

WHAT IS THE END GAME FOR THESE BANKSTERS?

The good news is that the warlord banksters have now been identified and we can observe their wars with one another. Essentially, we can see the most powerfully evil forces on the planet, trying to annihilate each other. And this is why it can sometimes be confusing to We the People. Just remember as you watch the political and economic landscape that there are THREE DIFFERENT BANKING FACTIONS. Two are battling with one another to become the global victor—the Central Bankers vs the CIA Bankers. And one, the Broker Bankers, are just trying to grab all they can for their personal greed. Once they do that, the Broker Bankers will probably align themselves with the global victor, if they haven’t caused the total collapse of the system first.

Nations cannot have peace as long as the warlord bankers and the military industrial complex are still making profits and have not been brought to justice. Central Bankers continue to try to create war, but it is now a global game of imperialism they are playing and they are outgunned. The CIA Bankers have as much gold as all of the gold reserves in all of the countries in the world. This means, ultimately, the CIA Bankers may win the war among bankers if the Broker Bankers don’t bring it all down immediately with their cavalier derivative swaps.

KEY POINT: Citizens around the world are waking up and realizing that all wars are banker wars.

Brokers know that the house ultimately wins and, in this case, the CIA aligned with the U. S. Treasury becomes the ultimate inside trader who will win the game.

The U. S. Treasury will eventually win this battle because America has the most gold reserves in the world, not counting the CIA gold. America is the military arm of CIA global economic terrorism. The CIA also uses many other agencies and groups to carry out their plans through intimidation and threats of prosecution from their friends at the SEC, CFTC, FBI, etc. No one is safe from the assassination policy of the CIA. Once an insider, always an insider. Thus, the CIA Bankers have either very loyal operatives, or dead former operatives.

CIA Bankers also use the IMF, World Bank, BIS and many other global organizations to carry their work into every country in the world. These organizations are used by the CIA Bankers, just like they use Central Bankers and manipulate Broker Bankers. In the end, the U. S. Treasury has supreme power over the U. S. economy and will win any economic war waged against America. The problem is that CIA Bankers don’t really work for America; they work for the CIA (the company) and are addicted to power, control and manipulation. These CIA Bankers did nothing to earn the gold they possess and they have done nothing with it except use it for themselves and their organization.

The U. S. economy will probably crash soon due to insane gambling on derivatives. This is probably a good thing in the long run. Once the “unfree markets” have shown themselves to have been a lie and simply nothing more than “gambling casinos,” we can start again with truly free markets and a currency backed with precious metals.

KEY POINT: Brave Patriots will need to step forward to demand the dismantling of the CIA and the shadow government, bringing the U.S. Treasury back into the control of We the People.

When the markets collapse, all gold in the world will have to be re-evaluated and re-assessed and the CIA gold will then be added to the total. This will give America a huge advantage in world markets and could create a stronger American currency backed by gold and precious metals. The paper fiat currency of the Fed can be burned in a trash heap along with the fake debt we “owe” to the Federal Reserve ($20 trillion). The Federal Reserve is a corporation and can go bankrupt – and should. The Treasury can take all of the Fed’s assets and add them to the people’s public assets. This will create a stronger America and once we have severed the links with globalist economic terrorists like the World Bank, WTO, IMF, BIS and other such criminal globalist enterprises, America can again become the ‘land of the free.’

WHAT YOU CAN DO AT A PERSONAL LEVEL?
Please see our articles Time to FedExit and Backstory of the New $100 Bill to read specific suggestions of preparing you and your family for this economic transition. Needless to say, you need to spend some time researching these topics yourself so that you are prepared for the inevitable collapse of the world’s economic system as we know it. There are also recommendations in these articles that if we all implement collectively, can not only protect our family’s wealth, but can also collapse the fraudulent banking system—not into the hands of the banksters, but into the hands of We the People.

HERE IS THE FULL STORY:

Beware the Banksters: Three Banking Syndicates Want to Enslave You

DinCO
DinCO
  mark
January 2, 2020 10:58 pm

Interesting – it will take some time to wade through the entire article. Thanks! It makes sense. On a slight tangent – are you aware of the $21Trillion uncovered by Catherine Austin Fitts and Mark Skidmore of Michigan State (economics prof) that were “adjustments” in the annual spending reports of HUD and DOD from (I think) 1995 till about 2016? This is in ADDITION to the official debt of the US gov’t, BTW. They tried to get more info than what they initially uncovered, but were shut down for reasons of “national security”. During the Kavanaugh hearings, FASAB56 was passed by Congress – it essentially allows corporations doing business with the US gov’t to not disclose their financial information if it is related to “security of the gov’t” [related to classified information]. In other words, the financial statements of such corporations perhaps mean nothing from now forward.

https://constitution.solari.com/fasab-statement-56-understanding-new-government-financial-accounting-loopholes/

Here is info on the “missing $21Trillion”
https://missingmoney.solari.com/dod-and-hud-missing-money-supporting-documentation/

Point being, where is the $21 trillion; where did it go and how is it influencing markets, etc or ??

Maybe all the folks here on TBP already know all this; maybe not. Anyway, I found it interesting.

mark
mark
  DinCO
January 2, 2020 11:25 pm

DinCO,

I am well aware of the 21 trillion, right from the start as I watch most interviews on Greg Hunter’s Vid channel, and I believe it broke there.

Who knows the actual amount…it could be three times that as now they have shut down any further audits behind their favorite curtain: “National Security.”

As to where it is I have assumed the ‘Plunge Protection Team’ is using some to keep the Stock Market bubble inflated. But who really knowns besides the Crime Family behind it? I’m sure the MIC got a cut. No telling.

I have posted many times about the various Crime Families, but this article (it’s from 2016) makes perfect sense as it describes the 3 main Banking Crime Families, and their infighting…while fighting for control of the NWO controls.

There are many sub Crime Families: Secret Societies, Mafias, Think Tanks, Billionaires, Dictators, Gangs, Cabals, Shadow Government – Government agencies/employees, etc. under them. Who really knows or can track their shifting ‘Game of Throne’ alliances, betrayals, murders, plunder, etc.

I’m just a long time Prepper/farmer/defiant Clinger…getting ready for whatever is going to happen…whenever it happens…and trying to peek behind their curtain.

Praise the Lord and pass the 7.62.

DinCO
DinCO
  mark
January 3, 2020 7:57 am

Ok. Same here re:Greg Hunter. Did not know your background. Same on: stay informed, be prepared for what may come. Dam with break at some point.

mark
mark
  DinCO
January 3, 2020 11:35 am

DinCO…I suspect we are simpatico…enjoyed your posts…if you are new here WELCOME…many bright and entertaining minds here with open eyes.

The no holds barred debates, dark humor, and point-counter points free for all’s are often more revealing of the many layered issues than the articles being commented on.

DinCO
DinCO
  mark
January 3, 2020 5:20 pm

Thanks, Mark. I’m sort of new as far as posting; occasionally here and there. I’ve been a long time lurker, if you will, here on TBP, so I have some idea how the shit-throwing can occur here. I have chuckled a few times at a newcomer that has wandered in here, made a few crappy comments about one of the long time posters on TBP and just got slammed by everyone, tried to rebut and would finally just go away. Sort of like a newbie walking into a bar and insulting one of the oldtimers there that everyone got along with and a barfight would follow, with the newbie having his ass handed to him. Anyway, yes there are many different types of folks that hang out here, exchange ideas, don’t always agree(but that’s how it should be). A rational discussion of relevant topics is great, but I’m not a fan of shit-throwing monkeys. My view – we are midway through this 4th turning and it will get much worse before we come out the other end. Trump just happens to be where he was and the type of person that was needed at this time to play his part in the play. So, make some popcorn, grab a soda or beer (pick your choice of libation), sit back and watch and try not to be collateral damage in the fallout of what is coming. And keep accumulating the 4 precious metals – gold, silver, lead and copper (JHPs, of course).

DinCO
DinCO
January 2, 2020 9:11 pm

Recently, gold is at all time highs in most world currencies EXCEPT the US$. The US$ seems to be the best looking currency in the glue factory (mixing metaphors), since the US has essentially the “highest” interest rates of the developed countries in the world, and currency is looking for a place to go to generate ANY return [going to US treasuries and the US stock market]. Gold keeps getting talked down here in the US, but it is interesting to see the amount of gold that Russia, China and India (both gov’t and people) have been accumulating in the last few years. Supposedly in 1912 J.P. Morgan stated “Money is gold, nothing else.” I’ve heard that he supposedly said “Gold is money; all else is credit”. Either way, it makes the point. Another saying I’ve heard – “Gold is the currency of kings, silver the currency of citizens, and debt is the currency of slaves”.

DinCO
DinCO
January 2, 2020 11:01 pm

Breaking News

is useful, too.