Gold, page-3391

I like your optimism but that is a clearly down channel and there is no sign that a reversal is in sight. I am a realist even though I have gold stock exposure.

With these type of down channel so clearly defined, a bounce off the lows usually eventuates as price never go up or down in a straight line. It is the sustainability of that bear rally that is the question. Remember this time last year when gold rallied? Everyone thought that it was a bottom forming reversal.

I don't know when gold will reverse but in time it will happen. It is the length of time in between that I am not prepared to try to pick. You usually end up with smelly fingers!

The short history of QE if you ignore the Japanese experiment, has 'worked' for the US economy. They printed (stimulus), tapered and now hiking rates. Everybody said tapering was impossible as they were addicted to debt. Then everybody said hiking was impossible because the economy is not strong enough. By this time next year people will also be saying additional rate hike is impossible, blah blah.

I am all for a world recovery especially a stimulated Chinese economy that will drive commodity prices up and reverse the strength of the USD leading to a gold rally. Unfortunately the binary logic has been distorted by QE and I am not going to even anticipate triggers where investors will jump into gold for safety/hedging.

Diversify portfolio and stop thinking Gold is money. Gold is a commodity!