Gold & Precious Metals

Is A Massive Gold Rally On The Horizon?

RESEARCH HIGHLIGHTS:

  • Gold rebounded quickly and broke to higher prices after the COVID deep selling.
  • Our Fibonacci support levels for Gold are resting near $1,885, $1,815 & $1,790.
  • More downside pressure on price is possible, but if support is maintained at $1,885 then we could see a big upside recovery trend take Gold to $2,250.

Just before the COVID-19 collapse in the markets hit near February 25, 2020, Gold started a double-dip move after reaching $1,692 on February 24.  First, Gold dipped from $1,692 to $1,564, then recovered to new highs ($1,704.50) on March 10, 2020.  Then, as the deeper COVID-19 selling continued, Gold prices dipped again – this time targeting a low level of $1,450.90.

What we found interesting is how quickly Gold prices recovered and broke to even higher price levels after this deep selling.  Our belief is that when a crisis event first hits, which we sometimes call the “shock-wave”, all assets take a beating – including Gold and Silver.  This is the event where traders and investors pull everything to CASH (closing positions).  Then, as the shock-wave ends, traders re-evaluate the price levels of assets to determine how they want to deploy their capital….CLICK for complete article

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The VR Metals Resource Letter provides subscribers his unique insights, opinions and recommendations on the following market sectors: METALS (Gold, Silver, Copper, Palladium and Platinum) and all Natural Resource investments including ENERGY (Crude Oil, Natural Gas. Green/Solar energy and materials), Cyclical (Annual Forecast Model) analysis and technical analysis are utilized. Huge opportunities may lay ahead for all natural resource plays and the VR METALS/RESOURCE Letter will be on top of them regardless of which direction they move!

Gold Inches Closer To $2,000

Gold prices advanced higher on Monday as a weaker US dollar and expectations that the US Federal Reserve will reiterate its dovish monetary policy stance later this week helped to reinvigorate investor interest for bullion.

Spot gold was up nearly 1.0% at $1,959.44 per ounce by 11:15 a.m. EDT — its highest in almost two weeks and the largest gain during this period. US gold futures also rose 1.0% to $1,969.20 per ounce.

“Gold is firm on the basis that the Fed could adopt a further dovish message with respect to average inflation targeting,” Michael Hewson, chief market analyst at CMC Markets UK, said in a Reuters interview.

“If you want to have a policy of average inflation targeting, you’re going to have to go into detail as to how you are going to arrive at that particular outcome,” Hewson added…CLICK for complete article

World’s gold miners wary of production ramp-up despite price surge

The world’s top gold miners are retrenching after covid-19 related shutdowns despite record prices for the yellow metal, with cost-conscious executives prioritizing investor returns over production growth.

Gold prices have jumped 30% this year to roughly $2,000 an ounce as central banks dial-up stimulus measures in response to the coronavirus pandemic.

That has fuelled a cash surge for miners, with top- and mid-tier producers holding roughly $5 billion in cash as of June 30, according to Scotiabank estimates.

But interviews with executives, analysts and fund managers show miners are hesitant to spend on pricey projects and tap marginal deposits that require sizeable capital and take years to break even.

Seven out of 10 of the global gold miners, including Newmont , the world’s biggest gold miner, Canada’s Barrick and South Africa’s Gold Fields, have cut planned output for the year by 7%, citing coronavirus-related shutdowns, regulatory filings show.

The caution is a reversal from the 2011 gold price boom, which prompted buyers to overspend on acquisitions and led to billions in impairments when prices crashed in subsequent years.

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Gold price steadies after briefly topping $2,000

Gold prices steadied on Tuesday with the dollar erasing losses and a US report adding to signs of a recovery in global manufacturing, pulling the precious metal down from a two-week high.

Spot gold dipped by less than 0.1% to $1,967.59 per ounce as of 3:30 p.m. EDT, having earlier hit its highest since August 19 at $1,992.15.

US gold futures declined 0.2% to $1,973.40 per ounce after crossing the $2,000 per ounce mark earlier in the session.

The dollar recovered on data showing US manufacturing expanded in August at the fastest pace since late 2018, reducing demand for bullion as an alternative asset.

The manufacturing report “confirms that the US economic recovery is real and hence we experienced a bounce in the dollar index,” Naeem Aslam, chief market analyst at Ava Trade, said in an interview with Bloomberg.

Gold Discoveries Are Declining

There has been a significant decline in new gold discoveries over the past decade as precious metal explorers focus on known deposits.

The world has been using gold for over 5,000 years as a store of wealth. Because it has always been a finite commodity, it has always held trade value. Currently, the price of gold is nearing a historic $2,000 an ounce due to unprecdemted money printing and monetary chaos.

Now, that same finite nature is making it difficult to discover and explore new gold mines. The known major gold mines in existence are being depleted, and it has become expensive to explore for new deposits.

There have been no critical new gold discoveries for at least three years. A mere twenty-five deposits with sound economics have been discovered within the last ten years—these discoveries amount to only 154.3 million ounces or seven percent of all known gold in existence.

The major reason for this lack of new gold discoveries is that gold mining companies have placed their focus on known deposits instead of risking funds in search of unknown and new discoveries. 

Exploring for new gold deposits requires time, financial resources, and the expertise for the task. In addition, the odds of success are low. Only 10 percent of known gold deposits around the world contain the necessary amount of gold to make exploration and mining worthwhile…CLICK for complete article