While, I am bullish on the price of Gold, it is an obvious fact that every bull run comes to an end, usually, the stronger the run the more pronounced the correction. Here are some of the reasons I am bullish for the near future:
Global gold production has increased slightly over the past decade.
Covid 19 has reduced this production in many mines this year of both Gold and Silver
The traditional Gold buying in Inda has been significantly disrupted by Covid 19, this is a major demand for free market gold
This reduction in demand has been absorbed by other markets and increased
Nations and large funds have been quietly increasing thier stockpiles including many non traditional participants in the Gold market
The gold price will lag the economic situation, often a crisis will become 'self evident' to the masses before there is a palpable increase in price, due to this lag the price movement of gold may appear illogical until the benifit of hindsight is applied
Personally, I am uneasy with the speed of price increase of Gold and would prefer a more sustainable rise but will still do well with a 20 % correction. There are posts that are contrary to bull market hypothesis, there are some good reasons why people need to a wary in a bull market. Therefore, alternate theories are important in this thread to keep a complete picture of the situation. Concersly, Edward Norton noted in Fight Club, 'On a long enough timeline the survivability rate for everyone drops to zero'. Likewise, a long enough bull run will end in a correction. So, to quote the late Philosopher Kenny Rogers, 'You got to know when to hold em, know when to fold em'.
Shafiee, S., & Topal, E. (2010). An overview of global gold market and gold price forecasting. Resources Policy, 35(3), 178–189. doi:10.1016/j.resourpol.2010.05.004
