I'm also highly bullish on gold. Along with silver and platinum, it looks and feels like the early stages of most major multi-year bull markets I've seen.
A lot of people are focusing on $400 in Gold, but although that is clear resistance, if you look at the long-term chart then the key level appears to be the decade high of $418 in early 1996.
I would say that a move above $420 would set up a classic breakout and confirm the bull market. Currently we are just retracing the grinding bear market from 1996-99. But once we get a sustained break above $420, we are in new territory. The only real resistance above there is around $500 (the high of 87/88), and then it's all the way up to the previous highs.
As has been mentioned by others, the fundamentals are favourable, with dollar troubles, easy monetary policy, and the commodity boom, all contributing to inflation fears. The price action is bullish, and sentiment sceptical. Technically the picture is good, with multiple major support levels at $298, $319, $340 and more recently $366. It is a good setup IMO.
If my thesis of a multi-year secular bull market is correct, then gold will go at least to the old highs ($850+) and most likely beyond. In that case I would assume that stocks like NEM would go up 4 or 5 fold if not more, and junior exploration stocks would go through the roof. However, I have no experience in mining stocks so am reluctant to commit much capital until I have completed my ongoing research into the sector. Any tips would be much appreciated!
Finally, there is a great article I read recently about playing long-term bull markets. It is written about gold but is applicable to all secular uptrends. The key is that holding is better than trading, since you eliminate the major bull-market risk - exiting a winning position too early on a short-term shakeout, and then failing to get back in.
http://www.kitco.com/ind/Appel/oct222003.html
A lot of people are focusing on $400 in Gold, but although that is clear resistance, if you look at the long-term chart then the key level appears to be the decade high of $418 in early 1996.
I would say that a move above $420 would set up a classic breakout and confirm the bull market. Currently we are just retracing the grinding bear market from 1996-99. But once we get a sustained break above $420, we are in new territory. The only real resistance above there is around $500 (the high of 87/88), and then it's all the way up to the previous highs.
As has been mentioned by others, the fundamentals are favourable, with dollar troubles, easy monetary policy, and the commodity boom, all contributing to inflation fears. The price action is bullish, and sentiment sceptical. Technically the picture is good, with multiple major support levels at $298, $319, $340 and more recently $366. It is a good setup IMO.
If my thesis of a multi-year secular bull market is correct, then gold will go at least to the old highs ($850+) and most likely beyond. In that case I would assume that stocks like NEM would go up 4 or 5 fold if not more, and junior exploration stocks would go through the roof. However, I have no experience in mining stocks so am reluctant to commit much capital until I have completed my ongoing research into the sector. Any tips would be much appreciated!
Finally, there is a great article I read recently about playing long-term bull markets. It is written about gold but is applicable to all secular uptrends. The key is that holding is better than trading, since you eliminate the major bull-market risk - exiting a winning position too early on a short-term shakeout, and then failing to get back in.
http://www.kitco.com/ind/Appel/oct222003.html