Demand for Gold Rockets Higher

Is the once Goldman Sachs "slam dunk sell" turning into a layup buy?

I cannot hate the initial call from many investment bank analysts it to sink to $1,000 because, in 2013, I issued a $1,035 bear-call. However, I do ridicule these analysts for unwillingly (either through ignorance or moral hazard) understanding the dynamics of gold             .

But in 2014 I turned rather bullish on the precious metal. As readers know, I developed a hybrid approach: bullish on physical bullion while understanding that prices are sentiment drive. It was hard to deny that the longer-term fundamentals for gold             were strengthening between global stagnation and misguided central banking policies.

Despite central banks, primarily the Federal Reserve , trying to fill in the ever-widening gaps via patchwork, market participants remains highly negative up until late December.

This year, traders saw absolute carnage for risk assets and the strongest demand for gold             in years. GLD             has seen massive inflows, only second to SPY             . IAU             has seen inflows everyday this year. The demand has been so strong, BlackRock             (which manages the iShares Gold             Trust) suspended share issuance.

Secondly, inflows to both popular gold-backed ETFs have not been this strong since the SPX             fell 18 percent and the Federal Reserve were mere months from starting quantitative easing in 2009. And, we know what happened after that.

Now, the recent move will likely remain volatile as gains on consolidated and traders buy on pullbacks. As you can see in the weekly chart of GLD             , the entire move from 2008 to 2011 remained in demand to overbought. If the fund sees a similar nominal gain over the next couple years, traders could see $2,230 for spot gold             prices.


Considering that the top three central banks have gone over the deep-end to appease risk assets, we could be seeing a resumption of the gold             bull market.

Please feel free to comment and share charts! And follow me @Lemieux_26

Check my posts out at:

EN English
EN English (UK)
EN English (IN)
DE Deutsch
FR Français
ES Español
IT Italiano
PL Polski
TR Türkçe
RU Русский
PT Português
ID Bahasa Indonesia
MS Bahasa Melayu
TH ภาษาไทย
VI Tiếng Việt
JA 日本語
KO 한국어
ZH 简体中文
ZH 繁體中文
Home Stock Screener Forex Signal Finder Cryptocurrency Signal Finder Economic Calendar How It Works Chart Features House Rules Moderators Website & Broker Solutions Widgets Stock Charting Library Feature Request Blog & News FAQ Help & Wiki Twitter
Profile Profile Settings Account and Billing My Support Tickets Contact Support Ideas Published Followers Following Private Messages Chat Sign Out